Pratik Bagadia

Short analysis on upcoming IPO: Meesho

Meesho: Ecommerce platform connecting Bharat with 7cr sellers. Buyers are mostly from Tier 2/3 cities

Positives:

·         Have cracked the Bharat code which no other ecommerce player has so far cracked. Has 23cr buyers, 450cr orders annually which is 2x of flipkart and 4x of Amazon

·         Capital efficiency is high: they crossed 40,000 Net merchandise value (NMV) with just 6500cr capital which is 6x; much better than platforms like Nykaa which is 4x

·         High growth registered: Rev of 5700cr in FY23, 5600cr already achieved in 6months of FY26

Risks:

·         Avg order size is less than other online platforms, thus they need more repeat orders

·         They already have 23cr shoppers on the platform, since not many shop online future growth can get moderated

·         Loss making business

Valuation:

·         Meesho is priced at 1x NMV whereas Nykaa is 4x and Eternal is 4x

·         Even offline retailers like Trent, Vishal Mega mart are priced a