Meesho Submits Updated Draft Red Herring Prospectus (UDRHP I) to SEBI

UDRHP 1 Link:

INDIA: Meesho Limited, a pioneering technology platform, has filed its Updated Draft Red Herring Prospectus (UDRHP) with the Securities and Exchange Board of India (SEBI). This move marks a significant milestone in the company’s journey, as it brings together consumers, sellers, logistics partners, and content creators to drive e-commerce growth in India.

The proposed initial public offering comprises a fresh issue of equity shares worth ₹4,250 crore, with a face value of ₹1 per share, and an offer for sale of up to 17,56,96,602 equity shares, also with a face value of ₹1, by selling shareholders. The offer for sale includes equity shares from prominent investors such as Elevation Capital V Limited, Peak XV Partners Investments V, and Highway Series 1, as well as individual selling shareholders.

Meesho plans to utilize the net proceeds from the issue to fund various initiatives, including investments in cloud infrastructure, payment of salaries for its machine learning and AI teams, and expenditure towards marketing and brand initiatives. The company also aims to drive inorganic growth through acquisitions and strategic initiatives, while focusing on general corporate purposes.

In FY25, Meesho emerged as India’s largest e-commerce platform by Annual Transacting Users and annual Placed Orders, with over 500,000 transacting sellers connected to ~199 million Annual Transacting Users, facilitating ~1.8 billion Placed Orders during the year. This achievement underscores the company’s focus on making e-commerce affordable, accessible, and engaging for consumers across India.

Meesho’s Annual Transacting Users grew ~28% year-on-year in FY25, with significant traction across India. The company’s Annual Transacting Users (ATU) for the Last Twelve Months (LTM) ending June 2025 reached ~213 million, while order frequency improved from 7.5x to 9.2x per year and 9.4x for the last twelve months ended June 2025. This growth highlights rising engagement and trust in the platform as Meesho continues to enhance discovery and experience.

Total orders increased from ~1 billion in FY23 to ~1.8 billion in FY25, with a ~50% year-on-year growth in Q1 FY26, reaching ~562 million orders. The growth in Placed Orders during Fiscal 2025 was driven by strong momentum across India, including orders from the Top 8 cities, which grew by ~46% compared to overall platform growth of ~37%.

The company’s Net Merchandise Value (NMV) grew ~29% year-on-year to INR ₹29,988 crores in FY25, following ~21% growth in FY24. In Q1FY26, NMV growth further accelerated to ~36% year-on-year, reaching INR 8,679 crores. This acceleration is attributed to growth investments and an improved value proposition of the platform through better pricing, discovery, and assortment.

Meesho has demonstrated a remarkable turnaround, becoming the largest free cash flow generator among scaled listed e-commerce companies in India in FY25. The company’s Last Twelve Months Free Cash Flow swung from negative INR 2,336 crore to a positive INR 1,032 crore (with interest income) and INR 591 crore (excluding interest income), reflecting the benefits of an asset-light, capital-efficient model.

The company’s loss (before tax and exceptional items) narrowed from INR 1,672 crores in FY23 to INR 108 crores in FY25, despite increased investments in technology and user acquisition to strengthen its growth trajectory. The net loss for FY25 stood at INR 3,942 crores, primarily due to one-time exceptional items, including reverse flip tax and perquisite tax.

In Q1 FY26, Meesho continued to invest in growth, driving NMV up ~36% year-on-year for the corresponding period and reaching ~562 million orders, showing growth of ~50% for Placed Orders. As the company expanded in scale, related costs increased, reflecting the investments required to support the platform’s growth. As a result, the quarter’s loss before exceptional items was INR 148 crores, and net loss was INR 289 crores.

FY25 and Q1 FY26 reaffirmed Meesho’s leadership in democratizing internet commerce for everyone. The company remains focused on broadening market reach, creating long-term value for the ecosystem, and building a sustainable foundation for the next phase of growth.

Kotak Mahindra Capital Company Limited, J.P. Morgan India Private Limited, Morgan Stanley India Company Private Limited, Axis Capital Limited, and Citigroup Global Markets India Private Limited are the Book Running Lead Managers to the issue.