The brokerage has valued the e-commerce platform using a DCF-based approach, implying a 108x/25x FY28/30 EV/Adjusted EBITDA multiple.
Meesho made its public market debut on December 10, listing at Rs 161.20 on the BSE. The stock experienced a sharp upward movement following its listing, surging 58% to reach a peak of Rs 254.65.
However, as of January 9, the stock has corrected nearly 35.6% from its high and is currently trading at Rs 164, slightly above its listing price.
According to JM Financial, while Meesho holds a dominant position in the Indian e-commerce space with approximately 234 million annual transacting users, representing 90% of India’s online shopper base, much of the upside from its growth potential appears to be priced in at current levels.
The brokerage expects Meesho to deliver a 27% revenue CAGR over FY25–30, with adjusted EBITDA margins at 3.3% as a percentage of NMV by FY30.
Meesho’s platform operates on a pure-play marketplace model that connects sellers, consumers, logistics partners, and content creators. Notably, the company does not charge commissions but monetises via fulfilment, advertising, and data insights.With over 700,000 sellers and 18,000+ logistics partners, the company processes more than 1.6 billion annualised parcels, enabling deep cost efficiencies. In FY25, the adjusted cost per shipped order stood at Rs 59.1, while the platform incurred an EBITDA-level loss of just Rs 1.6 per order.
JM Financial noted that Meesho’s cost leadership and asset-light business model have helped it generate a free cash flow of Rs 5.9 billion in FY25. The firm highlighted that the ramp-up of Valmo, Meesho’s in-house logistics solution, has further reduced costs and expanded serviceable e-commerce categories across India’s Tier 2+ markets.
Despite these operational strengths, JM Financial flagged potential key risks, including plateauing logistics cost benefits, rising competition, and challenges in advertising-based monetisation.
Upside risks, however, could emerge from better-than-expected growth, monetisation of content and financing, and the development of new revenue streams such as Meesho Mall.
While acknowledging Meesho’s strong positioning and differentiated strategy, the brokerage believes that valuations remain stretched at current market levels. It advised investors to be cautious amid high volatility and upcoming stock unlock events, which could impact supply dynamics in the near term.
Around 10:30 am today, the shares of Meesho were trading 3.6% higher at Rs 171.05 on the BSE.
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(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of The Economic Times.)
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