The much-anticipated initial public offering (IPO) of the social commerce giant Meesho opens for subscription today, Wednesday, aiming to raise a significant sum of Rs 5,421 crore. The issue, which will close on December 5, has already generated substantial buzz in the market, underscored by a robust grey market premium (GMP) of around 45%, as reported by ET. This strong investor sentiment is fueled by positive analyst commentary and Meesho's unique positioning in India's rapidly evolving e-commerce landscape, which is increasingly favoring affordable, unbranded goods and regional sellers.
IPO Details and Anchor Investor Frenzy
Meesho has set a price band of Rs 105 to Rs 111 per share. At the upper end of this band, the company commands a valuation of approximately Rs 50,096 crore ($5.6 billion). Ahead of the public issue, the SoftBank-backed platform successfully secured over Rs 2,439 crore from anchor investors. This anchor book witnessed overwhelming demand, oversubscribed by nearly 30 times, with total bids exceeding a staggering Rs 80,000 crore.
A diverse group of 60 institutional investors participated in the anchor round. The list featured prominent global names like the Government of Singapore, Monetary Authority of Singapore, Tiger Global, Fidelity, BlackRock, Goldman Sachs, and Morgan Stanley. On the domestic front, major Indian mutual funds such as SBI MF, UTI MF, Tata MF, Motilal Oswal MF, Axis MF, Bandhan MF, and HSBC MF were allocated shares. In total, 21.97 crore equity shares were allotted to anchor investors at Rs 111 per share.
The IPO comprises a fresh issue of shares worth Rs 4,250 crore and an offer for sale (OFS) of 10.55 crore shares valued at around Rs 1,171 crore at the upper price band. The company plans to utilize the net proceeds from the fresh issue for investments in cloud infrastructure, marketing, potential acquisitions, and general corporate purposes. Meesho is scheduled to make its stock market debut on December 10.
Analyst Outlook and Key Growth Drivers
Brokerage firms have largely recommended subscribing to the issue. ICICI Direct has given a 'subscribe' rating, highlighting Meesho's strong user funnel expansion, improving operating performance, and attractive relative valuation. SBI Securities has also advised subscribing but cautioned that the path to sustained profitability requires monitoring as the company continues to invest in technology and marketing.
Ishan Tanna, a research analyst at Ashika Institutional Equity Research, told ET that while Meesho is still loss-making, the market is optimistic about its future potential. "The company is still loss-making, but the market is clearly betting that its rising order volumes and improving operating efficiency will help it turn profitable in the coming years," he said. However, he noted the risk that Meesho must prove its ability to convert scale into sustainable profits in a highly competitive sector.
A major strength for Meesho is its zero-commission model for sellers, which has attracted a vast network and created a massive catalogue focused on unbranded and regional products. In the first half of FY26, the platform recorded 15.4 crore daily active product listings, a sharp annual increase. Financially, Meesho's annual transacting users surged 46% between FY23 and FY25, far outpacing the broader industry's 11-20% growth. In FY25, 19.9 crore customers placed orders, with a remarkable 17.4 crore originating from beyond the top eight metropolitan cities, showcasing deep Tier-2 and Tier-3 penetration.
Financial Performance and Challenges Ahead
Meesho reported revenues of Rs 9,389.9 crore for FY25, marking a 23.3% year-on-year growth. While the company remains loss-making, its EBITDA losses have narrowed significantly over two years. It reported an adjusted loss of Rs 2,595.3 crore for FY25. Analysts at ICICI Direct believe that improving unit economics and operating leverage help mitigate long-term concerns despite the current losses.
Despite its strengths, Meesho faces notable challenges. The business still relies heavily on cash-on-delivery (COD), a model that increases operational costs and risks related to cancellations and fraud. Competition in the e-commerce space remains intense across logistics, seller acquisition, and product discovery, with well-funded rivals capable of aggressive spending.
Nevertheless, Meesho's IPO is poised to be one of the most closely watched market events of the year. With high retail investor interest, a solid GMP, and a favorable brokerage outlook, its listing could serve as a key indicator of how public markets value India's booming mass-market digital consumption trend.
