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News Topical, Digital Desk : E-commerce company Meesho is currently preparing for one of the largest startup listings ever. Its IPO includes a fresh issue of shares worth ₹4,250 crore and an offer-for-sale (OFS) of 175.7 million shares. Meanwhile, the company has also kept open the option of a pre-IPO placement of up to ₹850 crore. If this is completed, the fresh issue of shares may be reduced.
The Bengaluru-based company recently transferred its holding structure to India. The book-running lead managers for the issue include Kotak, J.P. Morgan, Morgan Stanley, Axis Capital, and Citi.
These investors will sell their stakes . Many of Meesho's investors are going to offload their shares through the IPO. Elevation Capital, one of its early institutional investors, is selling approximately 55.4 million shares. Meanwhile, Peak XV Partners is selling approximately 30.5 million shares, Venture Highway's Series 1 company is selling 15.7 million shares, Y Combinator Continuity is selling 12.6 million shares, and Golden Summit Limited is selling approximately 8 million shares. Furthermore, founders Vidit Aatrey and Sanjeev Kumar will also offload 11.8 million shares each through the OFS.
What will Meesho do with the funds? Meesho will use the funds raised to expand its technology and cloud infrastructure, hire top engineering and AI professionals, and strengthen brand and marketing. The company has earmarked ₹1,390 crore for improving its cloud backbone, ₹480 crore for tech and engineering, and ₹1,020 crore for marketing and brand building. Additionally, up to 35% of the proceeds are earmarked for acquisitions and general corporate purposes.
A look at the finances: Meesho's revenue continues to grow rapidly. In FY25, the company projects revenue of ₹9,389.9 crore, up 23% from ₹7,615 crore in FY24 and 64% from ₹5,734 crore in FY23. The company reported a loss of ₹3,941.7 crore (₹3,941.7 crore) for the fiscal year, impacted by technology investments, ESOP charges, and expenses related to US-to-India restructuring of ₹1,346 crore (₹1,346 crore). However, its adjusted EBITDA loss to the market narrowed sharply compared to FY23, reflecting cost-related improvements. Meanwhile, the company's margins increased from ₹5,658 crore (₹5,658 crore) in FY23 to ₹14,836 crore (₹14,836 crore) in FY25. The number of orders grew at a CAGR of 33% between FY23 and FY25. However, Meesho's average order value declined to ₹274 (₹274), indicating its low-pricing strategy. During this period, the cost per order declined from ₹50.45 in FY23 to ₹43.08 in FY25, thanks to the contribution of in-house logistics arm Valmo. Furthermore, the company's free cash flow remained positive. With no debt and over ₹5,700 crore in cash and investments, Meesho is entering its IPO with a strong balance sheet and an asset-light model.
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