Meesho kicks off investor orders for $603 million India IPO

The deal launch comes a day after an unusually dramatic anchor allocation round that saw several major funds walk away after not receiving the allocations they sought. Bloomberg

Meesho Ltd., an Indian e-commerce firm backed by SoftBank Group Corp., started taking orders Wednesday for an initial public offering that may raise as much as Rs 5,420 crore ($603 million).

The Bengaluru-based marketplace, which connects small manufacturers with value-conscious consumers across India’s smaller cities, has set a price band for the offering of Rs 105 to Rs 111 a share.

The deal launch comes a day after an unusually dramatic anchor allocation round that saw several major funds walk away after not receiving the allocations they sought. The company’s decision to allocate about a quarter of the shares in the anchor book to SBI Funds Mangement Pvt. triggered a pushback from some large funds, Bloomberg News reported.

Despite the investor protest, Meesho raised Rs 2,440 crore by allocating 219.78 million shares Tuesday to 125 anchor investors. Aside from SBI Funds, these included Abu Dhabi Investment Authority, Fidelity International, BlackRock Inc., Baillie Gifford & Co., WCM Investment Management and Dragoneer Investment Group LLC.

Brokerages are broadly positive on Meesho’s prospects. SBI Securities recommended subscribing to the IPO at the upper end of the price band for long-term investors, noting that the company has generated positive free cash flow for the past two years even though it continues to report net losses after exceptional items.

Bajaj Broking said Meesho’s emphasis on cost efficiency and technology investment has helped it maintain positive cash flows while building out new verticals to expand its digital ecosystem.

At a valuation of around $6 billion, Meesho is priced at roughly 5.5 times fiscal year ended March 2025 sales, which is considered attractive versus tech platform Zomato, which has traded at more than 10 times sales, according to Swastika Investmart.