The shares of recently listed e-commerce platform Meesho have delivered a spectacular multibagger return to its investors, soaring over 110% from its initial public offering (IPO) price. The stock continued its record-breaking rally for the third consecutive session on Thursday, December 18, hitting an all-time high of ₹233.50 on the BSE.
A Stunning Market Debut and Sustained Rally
In intra-day trading on Thursday, Meesho's stock jumped 8% to reach its peak of ₹233.50. This marked the fourth straight session of gains, with the stock climbing more than 41% during this period. The rally follows a blockbuster debut last week, where the stock began trading at a premium of over 46% to its issue price of ₹111. On the NSE, it opened at ₹162.50 and on the BSE at ₹161.20, setting the stage for one of the strongest market entries of 2025.
The latest surge received fresh momentum from global brokerage firm UBS, which initiated coverage on Meesho with a 'Buy' rating and a price target of ₹220. This call implied a nearly 10% upside from the stock's intraday peak at the time, fueling further investor optimism.
Analysts Sound Note of Caution Amid Valuation Debate
Despite the euphoria, market experts are urging investors to tread carefully. Harshal Dasani, Business Head at INVAsset, noted that the focus has shifted from listing excitement to a deeper debate about the company's valuation. "After nearly doubling from its IPO price of ₹111, the stock is now trading close to the ₹220 mark," Dasani said, adding that this alignment with a leading brokerage's target suggests much of the immediate optimism is already priced in.
He acknowledged Meesho's strong position in India's value-driven consumption story, with deep penetration in tier-2 and tier-3 cities and an asset-light model. However, he emphasized that the company is still on the path to consistent profitability. "The current valuation leaves limited room for error," Dasani cautioned, stating that sustaining high levels will require clear progress on unit economics and operating leverage.
Echoing a similar sentiment, Utsav Verma, Head of Research at Choice Institutional Equities, stated that their base-case target price of ₹200 implies limited near-term upside from current levels. Their bull-case valuation of ₹234 is contingent on stronger-than-expected improvements in monetization and execution.
UBS's Bullish Long-Term Thesis
UBS's optimism is rooted in Meesho's business model and growth trajectory. The brokerage highlighted the company's asset-light structure, accelerating user base, and improving financial metrics. In its report, UBS projected that Meesho's Net Merchandise Value (NMV) will grow at a compound annual growth rate (CAGR) of 30% between FY25 and FY30.
The brokerage also forecasts a sharp rise in Annual Transacting Users (ATUs) from 199 million to 518 million during this period. Order frequency is expected to increase from 9.2 times to 14.7 times, although the Average Order Value (AOV) may decline slightly from ₹274 to ₹233 as logistics efficiencies are passed on to users. UBS expects contribution margins to expand to 6.8% and adjusted EBITDA margin to reach 3.2% of NMV by FY30.
Meesho's ₹5,421-crore IPO was a massive hit among investors, getting subscribed 79.02 times. The offer consisted of a fresh issue of ₹4,250 crore and an offer for sale (OFS) of 10.55 crore shares worth ₹1,171 crore at the upper price band of ₹111.
