Meesho Selects Top Investment Banks for $1 Billion IPO, Targets $10 Billion Valuation
SoftBank-backed e-commerce platform Meesho is preparing for a landmark public listing, having appointed leading investment banks to manage its initial public offering (IPO) planned for later this year. Industry sources reveal the homegrown e-commerce contender aims to raise approximately $1 billion at a significant valuation premium to its last funding round.
Banking Consortium Assembled for High-Profile Listing
According to sources familiar with the matter, Meesho has selected a high-profile consortium of investment banks to lead its public offering:
- Morgan Stanley
- Kotak Mahindra Capital
- Citi
One source indicated that "talks are progressing and Meesho has already picked Morgan Stanley, Kotak Mahindra Capital and Citi as advisers for its IPO." Additionally, sources suggest JP Morgan might join the syndicate if ongoing discussions materialize.
Ambitious Valuation Target
Investment bankers have pitched a valuation of $10 billion for Meesho's market debut, representing a remarkable 2.5x increase from its private valuation of $3.9 billion in 2024. This ambitious valuation places Meesho among a growing cohort of Indian startups seeking premium valuations on the public markets compared to their private funding rounds.
The company joins other high-growth Indian startups like PhysicsWallah (PW), Ather, and Lenskart that are targeting substantial valuation increases as they transition to public markets with ambitious growth narratives.
Racing Ahead of Established Rivals
If Meesho successfully lists this year, it would achieve a notable milestone by beating Walmart-owned Flipkart to the public markets. Despite Flipkart's longer presence in the Indian e-commerce landscape (founded in 2007), Meesho (founded in 2015) is on track to list first.
"Expect Meesho to list on the stock exchanges around Diwali this year, which is during the September-October period," a source revealed. The company is reportedly working to file its draft documents in the coming weeks.
Pre-IPO Requirements
Before proceeding with its IPO plans, Meesho must complete its corporate restructuring by flipping its headquarters from Delaware, US, to India. This reverse merger process is reportedly in advanced stages, with Meesho likely to pay approximately $300 million in taxes resulting from the transaction.
Impressive Financial Trajectory
Despite being a relative newcomer to India's e-commerce battlefield, Meesho has demonstrated remarkable growth and financial improvement while competing against well-funded giants like Flipkart and Amazon.
The company has shown consistent revenue growth over recent years:
- FY22: Rs 3,240 crore
- FY23: Rs 5,735 crore
- FY24: Rs 7,615 crore
More impressively, Meesho has substantially reduced its losses from Rs 3,248 crore in FY22 to just Rs 305 crore in FY24, demonstrating improved operational efficiency and a path toward profitability.
Strategic Market Positioning
While Flipkart maintains its position as the overall market leader in Indian e-commerce, Meesho has carved out a significant niche by focusing on underserved markets. The company has strategically targeted Tier 3 cities and beyond, catering specifically to value-conscious consumers.
This differentiated approach has enabled Meesho to rapidly grow its market share despite entering the market later than established competitors. The company's focus on affordable products and serving price-sensitive customers has resonated strongly in India's emerging e-commerce markets outside major metropolitan areas.
As Meesho prepares for this significant milestone, the market will be watching closely to see if its public debut validates the ambitious valuation target and if it can continue its growth trajectory as a publicly traded company.
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