Meesho Ltd

Meesho Ltd

Meesho is an e-commerce marketplace which acts as a logistics, tech and support platform between sellers and consumers. It offers fashion, home care, beauty & personal care products and accessories across the mass Indian consumer with focus on affordability. 

The company was founded by Vidit Aatrey and Sanjeev Kumar in 2015, after working 3 years post graduating from IIT Delhi in 2012. It had raised funding from YCombinator, Softbank, Prosus Ventures, Elevation Capital, Sequoia Capital, Meta (Facebook), among others in the past.

RHP filed: 27th November 2025

BRLM: Kotak Mahindra Capital, J.P. Morgan India, Morgan Stanley India, Axis Capital, Citigroup Global Markets India

Auditor: S R Batliboi & Associates LLP

Disclaimer - Delta Partners (public market division under Dexter Capital) is not a SEBI registered Investment Advisor and this report does not constitute a recommendation but is only prepared for educational purposes. We (our team members including our directors) may or may not apply to IPO. 

This note is not reviewed by our CIO - Devendra Agrawal, CFA. It is prepared by our team of Investment Analysts, and is reviewed by our senior team members. Any questions related to Meesho’s IPO can be directed to shubham@deltainvest.in and we will come back. 

We at Delta Partners continue to analyze many business and IPOs. Investors interested to be part of this network are requested to fill the form & our team will reach out with more details. [Click Here]

Delta’s View : Subscribe for listing gains 

Meesho is getting listed at a valuation of ~50k cr which is ~5x P/S. We have studied the business and like its operating model targeting the tier 2/3/4 cities. However, at this point in time the company is still figuring out strategies to become profitable and hence we will continue tracking this company post listing & may apply now only for the listing gains. We continue to monitor Management’s execution.

Based on the current GMP of ~41%, one can expect decent listing gains, provided the GMP sustains.

The total smartphone users in India were ~70 cr in FY25. Of these 70 cr users, about 20 cr users made at least one purchase from Meesho in the year. Meesho has been able to tap a very large Indian consumer base over these years, with ~88% of these users being outside Top 8 cities. However, this growth has been fueled by significant investor capital (PE/VCs like YCombinator, Peak XV, Elevation capital, Meta, Fidelity) and cash burn. As a value-focused marketplace, Meesho relies on low fees to attract sellers and maintain competitive pricing, which impacts its path to profitability. 

Despite growth in order volumes ~34% CAGR, the company’s monetisation remains limited at ~31% take-rate, with revenue primarily from order fulfilment fees. Advertising revenue contributed just ~500 cr in FY25. The company’s contribution margins turned positive (~4% CM2 in FY24 & FY25) from being ~0% in FY23 after reducing logistics cost (through its platform – Valmo) and marketing costs, but the margin is still insufficient to cover employee expenses and other business costs. It would be really difficult to reduce logistics cost (~74% of its operating expense) further from 40 rs per order, as Valmo already processes 65% of its total shipments, leaving limited room for decline. Its Net AOV has declined by 13% in the last 2 years affecting its take per order. With a large portion of unbranded products, it would find it difficult to penetrate into larger cities where it will have to compete with large scale e-commerce players. The company continues to face challenges to decrease CoD orders (~77% of total orders) which decrease overall operational efficiency and logistics cost per order. The company also faces rising liabilities and a legal dispute with AWS, which could further affect its future cash flows.

Its IPO ask valuation ~50,096 cr is 4.9x times of its TTM Sales, which appears on a higher side with concerns regarding profitability. The company’s selling shareholders decreased their OFS shares by 40% from the OFS proposed in DRHP. 

• Despite a Net sales growth of 28% (2 yr CAGR) to reach 9,390 cr in FY25, the company reported an operating loss (EBITDA) ~581 cr (-6%) and a Net Loss ~3,942 cr (-42%) in FY25. The operating loss widened due to modest contribution margin ~4% and increase in share based compensation for employees. A large loss was incurred due to ~2,500 cr tax payment to demerge its Indian entity from its US parent.

• Its placed orders grew by 34% CAGR over last 2 years to 183 cr in FY25, led majorly by rise in Annual transacting users ~20 cr in FY25, where 88% of its consumers were outside Top 8 cities in India. The company’s focus on value and onboarding of more sellers, leads to a large portion of unbranded products on the platform. With risks of counterfeitism, duplicacy and unbranded sellers, it would find it difficult to penetrate deep pocket consumers in the Top 8 cities. The company would also need to compete directly with large-scale e-commerce players such as Amazon, Flipkart, Myntra in that segment. The company launched Meesho mall in 2023 to offer more branded products but is proving barely a success till now. 

• Its take rate % / monetization of the NMV ~31% consists of order fulfilment fee, advertisement fee and other fees (data insights & ancillary services) charged to sellers. Being a value focused e-commerce player, increasing order fulfilment fee for sellers could hurt sellers with more charges, leading to rise in prices for consumers and hence decrease in placed orders. Its marquee proposition for its consumers is affordability, therefore inability to compete at prices can drive its consumers away to buy products from local sellers directly. Its revenue from advertisement fee is very small ~500 cr in FY25 compared to over 8,500 cr through order fulfillment fee. The company intends to increase more of this advertising revenue from sellers but it is only a small portion of revenue, so is unlikely to impact take rate % significantly.

• For a net AOV of 163 rs, the company was able to monetize 51 rs from its sellers. After its direct costs attributed to logistics, software, contracted manpower, etc., it was able to keep just ~5.8 rs (11% CM1). Post netting its marketing expense, contribution margin was just ~2.3 rs (4% CM2), which is very low for the business as it still has to cover its employee expenses and other operating expenses. 

• To increase its contribution margin, the company had already cut its advertising / marketing expense from 16% of revenue in FY23 to 6-7% in subsequent years, which seems unlikely to go down from here. The company launched Valmo in 2022 to optimize its largest – Logistics cost, through which it was able to decrease logistics & fulfilment cost per order from 47 rs (84% of sales) in FY23 to 40 rs (78% of sales) in FY25. Valmo is a tech platform developed by Meesho to use lowest cost third party logistics partners throughout its entire logistics process for first mile, middle mile, sorting, and last mile delivery, which makes its overall logistics cost at a lower price. However, it would be very difficult for the company to reduce this logistics cost further, as Valmo’s share in total shipments is already 65% in 6M FY26, providing very little room to reduce costs even if it does all its logistics through Valmo. Hence, increasing contribution margin from here would be very challenging.

• The company’s gross AOV and Net AOV has declined by 19% to 274 rs and 13% to 163.5 respectively in the last 2 years. Although, the company says its good for the business because it provides better prices for consumers which increases order volumes. But it is also resulting in low take and contribution per order for the company. It needs to find a balance at an AOV where it can drive volumes and maintain sufficient contribution margin for the business.

• The buyers/consumers on its platform prefer CoD for order payment. Of the total shipments, orders paid by CoD were 77% of total shipped orders. The CoD orders have a success rate of just ~78%. The unsuccessful orders, where the company had to deploy its resources & logistics and customers don’t pay, act as a drag to overall contribution margin. Due to its large customer base from smaller cities and towns, this trend appears not changing anytime soon.

• The company saw an increase in its payable liabilities in FY25 which could hurt its cash flows in the future. Marketplace related payables increased by ~500 cr and Statutory dues payable increased by over ~700 cr in FY25. Meesho is also facing a legal dispute with AWS over alleged non-payment of over 127 cr in invoices, while Meesho has filed an 86 cr counterclaim from AWS.

Business

• Meesho operates as a pure-play e-commerce marketplace. It does not own any inventory, rather it acts as a logistics, tech and intermediary platform between sellers and consumers. The products offered on platform includes Fashion, Home care items, Beauty & personal care, and others. 

• It is India’s largest e-commerce platform in terms of Annual transacting users ~23.4 cr and Placed orders ~227 cr, as of TTM Sept 2025. In FY25, ~88% of its consumers were from outside Top 8 cities in India and ~54% of its consumers were women. No platform fee is charged from its customers.

• It had a Gross Merchandise Value (GMV) ~50,312 cr and Net Merchandise Value (NMV) ~29,988 cr in FY25. GMV represents the total value of placed orders without discounts irrespective of whether order was cancelled / returned / undelivered. NMV represents the total checkout value of successfully delivered orders. 

• The company provides a range of products at low prices including unbranded products, regional brands and national brands. It had Gross Average Order Value (Gross AOV) ~274 rs and Net Average Order Value (Net AOV) ~163.5 rs in FY25. The majority of products offered on its platform were unbranded products.

• It had a seller base of ~706k Annual transacting sellers, as of TTM Sept 2025. It charges no commission from its sellers. It charges sellers based on a variable order fulfilment fee, advertising fee and other services. 

• The company generates revenue by monetizing its sellers for the services offered on its platform. Its take rate % (Revenue from marketplace / NMV) ~31% comprises majorly order fulfilment fee, advertising fee and other services (data insights). 

• After netting its direct costs related to Logistics & fulfilment, Server, Software tools, contracted manpower and payment gateway charges, Its Contribution margin (CM1) was 11% in the last 2 years. Further netting marketing costs, Its Contribution margin (CM2) was 4% in the last 2 years. 

• It reported EBITDA loss of 581 cr in FY25 after subtracting Employee benefits expense and other expenses from its contribution margin. Its Net loss widened to 3,942 cr in FY25 due to exceptional loss items and huge tax payment. 

• Logistics cost is the largest component of its operating cost ~74%. It decreased Logistics cost per order from 47 rs (84% of revenue) in FY23 to 40 rs (78% of revenue) in FY25. This is largely attributable to an increase in the share of its tech platform – Valmo for processing its logistics. Valmo helps the company to achieve lowest overall logistics cost by integrating best priced first mile, middle mile, sorting centres, truck operators, and last mile delivery services from multiple logistics partners through its logistics process. Valmo was launched in 2022 and its share in supporting total total shipped orders increased to 65% in 6M FY26. 

Issue details

• Fresh Issue up to 4,250 cr
• Investment in subsidiary – Meesho Technologies Pvt Ltd (MTPL) for cloud infrastructure spend. Est ~ 1390 cr
• These costs would be attributed to increasing compute power, storage volume & network capabilities to better handle higher transaction volumes, broader engagement and peak demands.

• Investment in subsidiary – MTPL for Salaries payment for ML/AI and tech development. Est ~ 480 cr
• Investment in subsidiary – MTPL for Expenditure towards marketing and brand initiatives. Est ~ 1020 cr
• Funding inorganic growth, strategic initiatives and General corporate purposes. 

• Offer For Sale up to 105.5 million shares. 
• Elevation Capital V Limited, selling up to 24.45 million shares. MOIC ~36.5x
• Peak XV Partners Investments V, selling up to 17.38 million shares. MOIC ~25.9x
• Vidit Aatrey, selling up to 16 million shares. 
• Sanjeev Kumar, selling up to 16 million shares
• Venture Highway SPVs LLC, selling up to 8.64 million shares. MOIC ~2.37x
• Golden Summit Limited, selling up to 7.96 million shares. MOIC ~1.2x
• Y Combinator Continuity Holdings I, LLC, selling up to 7.2 million shares. MOIC ~109x

• The shareholders reduced their OFS from 175.7 million shares (in DRHP dated 27th Oct 2025) to 105.5 million shares (40% decrease). 

Promoters and Leadership

• Meesho was founded in 2015 by Vidit Aatrey and Sanjeev Kumar. They both used to be wing mates at the Indian Institute of Technology (IIT) Delhi hostel. 

• They finished their B.Tech (Electrical Engineering) from IIT Delhi in 2012. Vidit Aatrey worked in ITC Ltd for 2 years and InMobi for a year. Sanjeev Kumar joined Sony in Japan, working for camera technology for DSLRs and mobiles.

• They both decided to start up and got together in July 2015, looking to build a hyperlocal platform for fashion. After a few iterations, Meesho became a social commerce platform where resellers used WhatsApp, Facebook and Instagram to become a bridge between suppliers and consumers.

• Meesho was selected for Y Combinator’s summer program in 2016. The company raised a Series A round of $3.1 million in 2017, followed by a Series B round of $11.5 million in 2018, and a Series C of $50 million. In 2019, Meta (formerly Facebook) invested $125 million, making Meesho India’s first startup backed by the social network. Meesho became a unicorn in 2021 after raising $300 million, led by SoftBank, valuing the company at $2.1 billion, and later raised $570 million in its Series F round, doubling its valuation to $4.9 billion in 2021.

• Vidit Aatrey is currently serving as company’s Chairman, Managing Director & CEO and Sanjeev Kumar is the Whole-time Director and Chief Technology Officer (CTO) of the company. They both are also the only promoters of the company.

Shareholding Pattern

• Its promoters, Vidit Aatrey and Sanjeev Kumar own 11.1% and 7.4% of company’s shareholding on a fully diluted basis as of RHP date.

Related Party Transactions

• The company had no material related party transactions

Litigations and controversial activities

• The company had no material litigations filed against it that could affect or had affected its business significantly.
• The company was not found to be involved in any news / publicity that affects the business / brand negatively.

Financial snapshot

Business KPIs and Unit economics