US-based Fidelity has cut the valuation of low cost e-commerce platform Meesho and fintech giant Pine Labs as of October 31, 2023, regulatory filings with the Securities and Exchange Commission (SEC) showed.
Fidelity cut Meesho’s valuation from $5 billion earlier to $4.1 billion, while Pine Labs was valued at $3 billion as of October 31, 2023, down from its valuation of $4.7 billion on August 31, 2023, Fidelity said.
For both the startups, the reduction in valuation on paper was substantial.
Meesho had last raised $570 million at a valuation of $4.9 billion in September 2021 but saw its valuation being marked up to a little over $5 billion in August last year, Moneycontrol reported. The increase in valuation had come after a cut in value in April.
The Bengaluru-based company said the change in valuation is a common practice that its investors follow. “Funds attribute value to their portfolio investments, taking into account multiple factors. We would not be able to comment on the specifics, however, per share price changes are not fully indicative of valuation changes and should be looked at in conjunction with the number of shares,” a spokesperson for Meesho said in response to queries.
The latest change in Meesho’s valuation brings it closer to what it was valued at during a secondary sales transaction. Venture Highway, an early backer of Meesho, diluted its stake in the company and sold shares to WestBridge at a valuation of around $3-3.5 billion, as reported in September last year.
For Pine Labs, on the other hand, the slash in valuation to $3 billion from $4.7 was steeper.
Pine Labs did not immediately respond to questions about the change in valuation. The Economic Times was first to report on the change in valuations.
US-based asset management company (AMC) Invesco had also recently revised the valuation of Pine Labs. In 2021, Invesco invested in Pine Labs at a valuation of around $3 billion and said the fintech company is valued at $4.4 billion now, while that marked an increase in Invesco's books, it was a reduction for Pine Labs since it had last raised money at $5 billion.
It is important to note that these adjustments to fair values are typically based on AMC's internal assessment of the macro and microenvironment. They do not necessarily indicate a permanent markup or markdown in the startup's overall valuation.
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