Meesho, a homegrown Bengaluru based E-commerce brand backed by Softbank, is gearing up to launch its initial public offering (IPO) later this year, with a target to raise upto $1 billion, valuing the company at the staggering $10 billion– increased by 2.5 times with their present valuation of $3.9 billion.
If successful, Meesho’s IPO would not only be a glorious landmark for the company but a testament to India’s growing demand for E-commerce. The IPO is expected to launch around Diwali this year that lies between September and October, by this strategic move company Aims to make most of the profit when investors’ enthusiasm is at its peak.
According to reports, The company is in discussion with JP Morgan, a leading global investment bank, which could potentially join the syndicate of underwriters alongside Kotak Mahindra capital and cities as their leading advisors.
With a clever selection of its advisors, Meesho is poised to play a significant role in the competition against well-funded rival Walmart based Flipkart, who is set to launch its own IPO this year.
As a part of its IPO preparation, Meesho needs to relocate its Headquarters from Delaware, US to India,with an estimated tax out-go of $300 millions due to the reverse merger, paving the way for substantial sales growth.
Meesho being the third largest E-commerce platform in India,after the E-commerce Giants like Amazon and Flipkart has made substantial strides in building its user base despite the intense competition. By partnering with more than 21,000 individuals to promote the brand and expand its connections. The company has managed to exponentially increase its revenue from ₹3,240 crore in FY22 to ₹5,735 crore in FY23 and ₹7,615 crore in FY24(with a increase rate of 33% in year-on-year growth), while net losses have decreased significantly from ₹3,248 crore to ₹305 crore during the same period.
Earlier this year, Meesho’s valuation fell to $3.9-4 billion From $4.9 billion- a 20% decline. Although this decrease raises concerns,one should know secondary transactions reflect current market conditions, it does not impact company’s Future IPO valuations.
With increasing internet penetration and smartphone usage, Meesho’s public listing is well-positioned to take advantage of India’s quickly expanding e-commerce sector. Meesho’s emphasis on social commerce puts it in a strong position to thrive and maybe overtake Amazon and Flipkart.
