Is Meesho IPO Good or Bad – Detailed Review

Meesho Limited’s IPO is set to open its initial public offering from December 03, 2025, to December 05, 2025. When considering applying for this IPO, potential investors might have questions about whether the Meesho IPO is a good investment and if it's worth subscribing to.

This article provides a comprehensive Meesho IPO review, covering its business operations and fundamental analysis to help you make an informed investment decision.

Meesho IPO Review

Meesho Limited's IPO is open for subscription from December 03, 2025, to December 05, 2025, with listing expected on December 10, 2025, on NSE and BSE.

The company is a multi-sided technology platform driving value-focused e-commerce in India by connecting Consumers, Sellers, Logistics Partners, and Content Creators. The core focus is on affordability and accessibility, offering a wide assortment of products primarily to mass-market consumers in Tier 2+ cities. The platform has emerged as India's largest in terms of the number of placed orders and annual transacting users. Its integrated model is driven by proprietary AI/ML algorithms and a fundamental zero-commission model for its sellers, fostering a high-efficiency, scalable, and asset-light marketplace. The promoters, Vidit Aatrey (CEO) and Sanjeev Kumar (CTO), hold an aggregate of 18.50% of the pre-offer paid-up equity share capital on a fully diluted basis.

The company operates within the dynamic and highly competitive Indian retail landscape, specifically targeting the fastest-growing segment of value-focused e-commerce. The Total Addressable Market (TAM) for Meesho is the entire Indian Retail Market, which stood at approximately Rs 83 lakh crore (USD 978 billion) in FY25 and is projected to reach Rs 123 to 135 lakh crore by FY30.

Meesho’s financial performance from FY23 to FY25 reflects strong and sustained top-line growth coupled with volatile net profitability. Revenue from operations grew from Rs 5,735 crores in FY23 to Rs 9,390 crores in FY25, a CAGR of 28.5%.

There is a Net Loss of Rs 3,942 crores in Fiscal 2025 (widened significantly from a loss of Rs 328 crores in FY24) due primarily to a one-time exceptional tax charge and ESOP-related expenses. Operating efficiency showed strong improvement in core unit economics, with the Contribution Margin improving from 2.94% of NMV in FY23 to 4.95% in FY25. The Return on Equity (RoE) was deeply negative at -252.37% in FY25, severely impacted by the large, one-time accounting loss. Crucially, Last Twelve Months Free Cash Flow (LTM FCF) was positive at Rs 591.23 crores in FY25 (a massive swing from a loss of Rs -2,336.36 crores in FY23), underscoring the success of its asset-light model.

Strengths include a Platform Built on Multiple Scaled Self-Reinforcing Flywheels (Commerce, Logistics, and Content Commerce), a Technology-First Approach Driven by AI/ML Solutions (enabling hyper-personalisation and low-cost fulfillment), Delivering Everyday Low Prices through the Zero-Commission Model, and Demonstrated Ability to scale in a Highly Capital-Efficient Manner due to positive LTM FCF.

Risks include a History of Losses and the challenge of achieving sustained profitability, High Dependence on Cash on Delivery (CoD) payments (72% of Shipped Orders in H1FY26), Intense Competitive Landscape and Price Pressure against capital-rich players, Regulatory and Taxation Uncertainties (contingent tax dispute of Rs 572.06 crores for AY 2022-23), and Vulnerability to Technology Disruption and Data Breaches given the platform's heavy reliance on proprietary tech.

The IPO consists of a total issue of 48,83,96,721 shares valued at Rs 5,421.20 crores, comprising an Offer for Sale (OFS) of 10,55,13,839 shares (Rs 1,171.20 crores) and a Fresh Issue of 38,28,82,882 shares (Rs 4,250 crores). The fresh issue proceeds will be primarily used for investment in subsidiary Meesho Technologies Private Limited (MTPL) for cloud infrastructure (Rs 1,390 crores), Salary Payments for existing and replacement hires under Machine Learning and AI technology Teams (Rs 480 crores), and Expenditure towards Marketing and Brand Initiatives (Rs 1,020 crores).

The shares are priced in the band of Rs 105 to Rs 111 per share, with a lot size of 135 shares.

Company Overview of Meesho IPO

Meesho Limited is a multi-sided technology platform driving value-focused e-commerce in India by connecting four key stakeholders: 

• Consumers

• Sellers 

• Logistics Partners 

• Content Creators 

The core focus is on affordability and accessibility, offering a wide assortment of products primarily to mass-market consumers in Tier 2+ cities. The platform has emerged as India's largest in terms of number of placed orders and annual transacting users.

The platform is driven by proprietary AI/ML algorithms and a fundamental zero-commission model for its sellers. This technology-first approach enables hyper-personalised, discovery-led shopping experiences for consumers and low-cost order fulfillment for sellers, fostering a high-efficiency, scalable marketplace that is core to its success in the price-sensitive Indian market.

Meesho operates an asset-light, pure-play marketplace model, leveraging technology-first operations to drive operational efficiencies. The business is primarily focused on the domestic Indian market, generating all of its revenue from customers in India.

Its integrated suite of capabilities is built around multiple self-reinforcing flywheels (Commerce, Logistics, and Content Commerce) that improve scale, efficiency, and platform liquidity without reliance on owning inventory or fixed logistics assets.

This robust model supports growth across its two primary business segments (based on the six months ended September 30, 2025):

• Marketplace Segment (E-commerce): This is the core platform, generating revenue from services provided to sellers, such as order fulfillment, advertising, and data insights, which contribute 99.93% of Revenue from Operations.

• New Initiatives Segment: Emerging services focused on future growth, including its low-cost local logistics network (Valmo) and digital financial services platform, contributing to 0.07% of Revenue from Operations.

The Promoters of the Company are Vidit Aatrey and Sanjeev Kumar. Vidit Aatrey serves as the Executive Chairman, Managing Director, and Chief Executive Officer, and Sanjeev Kumar is the Whole-time Director and Chief Technology Officer. Dhiresh Bansal is the Chief Financial Officer. The Promoters hold an aggregate of 18.50% of the pre-offer paid-up Equity Share capital on a fully diluted basis.

Industry Overview of Meesho IPO

Meesho Limited operates within the dynamic and highly competitive Indian retail landscape, specifically targeting the fastest-growing segment of value-focused e-commerce. The industry is undergoing a significant transformation, shifting from a market heavily dominated by unorganized retail to a diverse, organized structure driven by technology.

The Total Addressable Market (TAM) for Meesho is the entire Indian Retail Market, which stood at approximately Rs 83 lakh crore (USD 978 billion) in FY25 and is projected to reach Rs 123 to 135 lakh crore (USD 1.4 to 1.6 trillion) by FY30.

Concurrently, the Indian E-commerce Market including quick commerce, the primary Serviceable Addressable Market (SAM), was valued at approximately Rs 6 lakh crore (USD 70 billion) in FY25 and is projected to grow at a robust 20% to 25% CAGR to reach Rs 15 to 18 lakh crore (USD 174 to 214 billion) by FY25, reflecting accelerating online penetration.

The sector is characterized by aggressive demands for affordability and technological advancement, driven by India's continued consumption growth. Meesho differentiates itself through its extensive capabilities, such as:

• Market Share Leadership: Meesho is the largest e-commerce player in India in terms of annual placed orders in the last twelve months ended September 30, 2025.

• Value-Focused Model: The platform specializes in addressing affordability and assortment, catering to the highly fragmented supply led by regional/unbranded products and enabling low-ticket purchases at scale.

The Indian E-commerce Market and the broader retail sector face several structural challenges, such as:

• Economic Sensitivity: Discretionary categories like fashion and home, which are core to the value segment, are highly sensitive to macroeconomic cycles, including inflation or income stagnation.

• Intensifying Competition: The e-commerce market continues to attract significant investment, escalating competition on parameters such as pricing, logistics capabilities, and seller incentives.

• Operational and Fulfillment Challenges: Reliance on a large-scale logistics ecosystem creates vulnerability to last-mile inefficiencies and rising costs, making consistent and reliable delivery paramount.

Financial Overview of Meesho IPO

Revenue from Operations has demonstrated strong and sustained growth across the last three fiscal years, rising from Rs 5,734.52 crore in FY23 to Rs 7,615.15 crore in FY24 and further rose to Rs 9,389.90 crore in FY25. This growth is primarily driven by the expansion of the marketplace segment and increased monetization from seller services.

Loss After Tax (LAT) has been consistently in loss, indicating priority on growth investment. Loss for the year was Rs -1,671.90 crore in FY23, which improved to a net loss of Rs -327.64 crore in FY24. However, the loss widened significantly to Rs -3,941.71 crore in FY25. This sharp rise was primarily due to a one-time exceptional tax charge and ESOP-related expenses arising from the corporate reorganization.

Return on Equity (RoE) reflects the continuous erosion of equity capital. RoE was deeply negative at -65.61% in FY23 and further widened to -252.37% in FY25, demonstrating the severe impact of the large, one-time accounting losses on shareholder funds.

Contribution Margin of NMV-Marketplace demonstrates the improvement in core unit economics, expanding strongly from 2.94% in FY23 to a peak of 5.61% in FY24, reflecting significant operating efficiency and scale gains. The margin stabilized at 4.95% in FY25, indicating a strategic decision to pass cost efficiencies to sellers to drive lower prices and improve volumes.

GMV (Gross Merchandise Value) reflects the platform's scaling gross transactional volume, growing from Rs 34,491 crore in FY23 to Rs 50,312 crore in FY25. The NMV (Net Merchandise Value), representing realized delivered order value, grew from Rs 19,233 crore to Rs 29,988 crore in the same period.

Free Cash Flow (FCF) mirrors the success of the company's asset-light model. Last Twelve Months (LTM) FCF swung dramatically from a loss of Rs -2,336.37 crore in FY23 to a net positive Rs 199.56 crore in FY24 and Rs 591.24 crore in FY25. This critical improvement to positive FCF, despite persistent net accounting losses (LAT), underscores strong underlying unit economics, effective working capital management, and minimal capital expenditure typical of a pure-play marketplace.

Strengths and Risks of Meesho IPO

Let's examine the strengths and weaknesses to determine if the Meesho IPO is a good or bad investment for investors.

Strengths

• Platform Built on Multiple Scaled Self-Reinforcing Flywheels: Meesho operates on interconnected Commerce, Logistics (Valmo), and Content Commerce flywheels. This multi-sided model orchestrates interactions between consumers, sellers, logistics partners, and content creators. This dynamic system constantly generates data that refines platform features, driving network effects, higher efficiency, and sustained transactional liquidity.

• Technology-First Approach Driven by AI/ML Solutions: The company dedicates a significant portion of its workforce to technology, with 1,182 full-time employees (56.77% of the total employee base) focused on tech, including a specialized AI/ML team. This approach enables real-time personalization, predictive logistics modelling (Valmo orchestration system), fraud detection, and automated seller enablement, ensuring the platform scales efficiently with minimal friction.

• Delivering Everyday Low Prices through Zero-Commission Model: Meesho’s core value proposition to consumers is consistently low prices, achieved by offering sellers a zero-commission platform coupled with highly optimised, low-cost fulfillment services. This structure reduces the average cost charged to sellers, empowering them to price products competitively and expand the mixture, thus driving transaction frequency.

• Demonstrated Ability to Scale in a Highly Capital-Efficient Manner: The company adheres to an asset-light marketplace model, avoiding capital-intensive investments in inventory and warehousing. This allows for superior capital deployment efficiency, demonstrated by a positive Last Twelve Months Free Cash Flow (LTM FCF) of Rs 591.23 crores in FY25 and a high GMV/Capital Employed ratio.

• Growing Trust Signals for Affordability Segment: To build confidence among value-conscious consumers for unbranded or regional products, the platform encourages transparency. As of September 30, 2025, it featured 1,298.22 million consumer ratings, 399.67 million reviews, and a consumer-friendly return policy with refunds processed, on average, within 1 hour and 14 minutes from pickup in FY25.

Risks

• History of Losses and Negative Cash Flow: The company has incurred losses since its inception in 2015. While cash flow was positive in FY24 and FY25, it reported a Loss for the Year of Rs 3,941.70 crores in FY25, largely due to one-time reorganisation costs and tax impact. The ability to generate adequate revenue and manage expenses to achieve sustained profitability remains a risk.

• High Dependence on Cash on Delivery (CoD) Payments: A significant majority of orders are paid via CoD, constituting 72% of Shipped Orders in the six months ended September 30, 2025. This reliance exposes the business to increased operational risks, including higher rates of delivery failure (Return to Origin or RTO) and cash handling complexities across its decentralised logistics network.

• Intense Competitive Landscape and Price Pressure: Meesho operates in a highly competitive sector against large, capital-rich horizontal marketplaces like Amazon and Flipkart and emerging specialized commerce models. Sustaining its value proposition amidst aggressive pricing, marketing, and feature innovation from competitors is a constant challenge.

• Regulatory and Taxation Uncertainties: The business is subject to an evolving legal framework, including the recently enacted Digital Personal Data Protection Act, 2023. Furthermore, the company faces a contingent tax dispute of Rs 572.06 crores for AY 2022-23, highlighting material risks associated with adverse regulatory interpretations or enforcement actions.

• Vulnerability to Technology Disruption and Data Breaches: The core operations rely heavily on sophisticated, often proprietary, technology such as BharatMLStack and Valmo. Any actual or perceived disruption, system outage, or cybersecurity breach could severely impair service availability, erode stakeholder trust, and expose the company to significant financial and reputational damage.

Strategies of Meesho IPO 

• Further Invest in Technology and Enhance AI Capabilities: A major portion of the Fresh Issue is earmarked for technology. This includes advancing AI innovation through "Meesho AI Labs" to strengthen personalisation, improve fraud detection systems, and enhance operational efficiency through AI/ML deployment across the platform.

• Deepen E-commerce Affordability: The company intends to reduce the average cost charged to sellers by constantly driving technology-led operational efficiencies and enhancing the cost-effectiveness of its Valmo logistics network. This ensures its prices remain competitive and supports the expansion of low-AOV (Average Order Value) categories.

• Increase Consumer Base and Transaction Frequency: The strategy focuses on driving growth by increasing the number of Annual Transacting Users and enhancing Order Frequency. This is achieved by continually expanding the selection of products, including unbranded and regional SKUs and scaling high-engagement features like Content Commerce.

• Improve Platform Monetization and Cash Flow Generation: The strategy aims to strengthen cash flow by expanding service offerings to sellers, such as advertising, expedited fulfillment, analytics tools and exploring ancillary revenue channels. A key initiative under evaluation is launching a digital Financial Services platform via regulated partners for its stakeholders.

• Drive Innovation and Strategic Expansion through Horizon 2 Initiatives: Meesho employs a disciplined incubation framework to launch and scale new opportunities, such as Meesho AI Labs and a low-cost local logistics network for daily essentials. A portion of the IPO proceeds is also reserved for strategic inorganic growth, like acquisitions, to quickly acquire complementary technology or market segments.

Meesho IPO vs. Peers

Meesho reported Revenue from Operations of Rs 9,389.90 crores in FY25. While this represents a significant operational scale, it positions the company behind established digital leaders like Eternal Limited (Zomato), with revenue of Rs 20,243 crores and Rs 15,226.7 crores for Swiggy Limited. However, Meesho’s scale is competitive with listed category specialists like Brainbees Solutions (FirstCry) (Rs 7,659.6 crores).

In terms of profitability, Meesho’s performance is marked by significant investments, resulting in a Loss for the Year of Rs 3,941.70 crores in FY25. This net loss, with one-time reorganization and tax charges, contrasts starkly with peers like FSN E-Commerce (Nykaa), which reported a Net Profit, though some competitors like Swiggy Limited also reported substantial net losses.

The company’s focus on customer acquisition and low seller costs means its Contribution Margin (4.95% of NMV in FY25) is directed toward platform penetration rather than high gross realization.

The Company's position as a high-growth, loss-making entity is reflected in its returns profile. Meesho recorded a negative Return on Equity (RoE) of -252.37% in FY25, substantially trailing profitable peers such as Avenue Supermarts (DMart) with 13.63% and FSN E-Commerce with 5.21%. While profitability remains limited, the valuation is justified by strong growth in key operational metrics such as Annual Transacting Users (ATU) and Placed Orders and its strategic focus on capturing the mass-market Indian e-commerce consumer.

Objectives of Meesho IPO

The offering consists of a total of 48,83,96,721 shares worth Rs 5,421.20 crores, out of which the offer for sale of 10,55,13,839 shares is valued at Rs 1,171.20 crores, and the fresh issue of 38,28,82,882 shares is valued at Rs 4,250 crores. The selling shareholders in this IPO are:

Elevation Capital V Limited, Peak XV Partners Investments V, Vidit Aatrey, Sanjeev Kumar, Venture Highway Series 1, a Series of Venture Highway SPVs LLC, Golden Summit Limited, Y Combinator Continuity Holdings I, LLC, Man Hay Tam, Sarin Family India LLC, Gemini Investments, L.P., will receive the offer for sale proceeds.

However, the fresh issue proceeds will be used for the following objectives:

1. Investment in subsidiary Meesho Technologies Private Limited (MTPL) for cloud infrastructure (Rs 1,390 crores)

2. Salary Payments for existing and replacement hires under Machine Learning and AI technology Teams undertaken by MTPL (Rs 480 crores)

3. Expenditure towards Marketing and Brand Initiatives (Rs 1,020 crores)

4. Funding Inorganic growth, Acquisitions and Strategic Initiatives and General Corporate Purposes totalling Rs 1,360 crores.

Meesho IPO Details

IPO Dates

Meesho IPO will be open for subscription from December 03, 2025, to December 05, 2025. The allotment of shares to investors will take place on December 08, 2025, and the company is expected to be listed on the NSE and BSE on December 10, 2025.

IPO Issue Price

Meesho is offering its shares in the price band of Rs 105 to Rs 111 per share. This means you would require an investment of Rs. 14,985 per lot (135 shares) if you are bidding for the IPO at the upper price band.

IPO Size

Meesho is issuing a total number of 48,83,96,721 shares valued at Rs 5,421.20 crores, out of which the fresh issue comprises 38,28,82,882 shares worth Rs 4,250 crores and the remaining 10,55,13,839 shares worth Rs 1,171.20 crores will be received by the selling shareholders in this IPO.

IPO Allotment Status

Investors who applied for the IPO can check their IPO allotment status on December 08, 2025, through the registrar's website, Kfin Technologies Limited, BSE, NSE, or through the stockbroker platform.

IPO Listing Date

The shares of Meesho are expected to be listed on the NSE and BSE on December 10, 2025.

IPO Application Link

Open demat account with Rupeezy today and enjoy a seamless experience when applying for the IPO. With an easy-to-use platform, Rupeezy makes the IPO application process quick and hassle-free.

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