Why are Meesho shares up by 13% today? Key reasons explained

Synopsis: Meesho shares jumped up to 13% intraday on heavy trading and investor optimism. Choice Institutional Equities initiated the first Institutional ‘BUY’ rating, citing 31% revenue CAGR, faster profitability, and attractive valuation.

The shares of an e-commerce company, specializing in operating as a major Indian e-commerce marketplace that focuses on providing a wide assortment of affordable, unbranded products to value-conscious customers, have rallied upto 13 percent in the Intraday trade. Let’s explore the reason for the rise in this article.

With a market capitalization of Rs. 83,380.10 crores on Tuesday, the shares of Meesho Limited rose by upto 13.3 percent, reaching a high of Rs. 193.50 per share compared to its previous closing price of Rs. 170.75 per share.

Meesho’s shares have surged by 74 percent since the issue price of Rs. 111 per share, propelling the company’s overall market capitalisation to over Rs. 85,000 crore. This remarkable growth reflects strong investor confidence and the platform’s expanding footprint in the e-commerce sector.

Reason for the Rally

Following a two-day drop, the stock surged over 6 percent on Monday and continued its upward momentum on Tuesday, despite broader market weakness.

The stock saw significant trading, with a turnover of Rs 124.38 crore and 66.84 lakh shares changing hands. According to BSE data, the company’s total market value was Rs 85,207.91 crore, while its free-float market value was Rs 5,279.14 crore.

First Institutional Rating

Meesho recently received its first institutional rating from Choice Institutional Equities, which initiated coverage with a ‘BUY’ rating and set a target price of Rs. 200 with an upside potential of 18 percent from yesterday’s close.

Choice Broking highlighted a “faster road to profitability” as a key upside catalyst for Meesho, valuing the company at 4x FY28E EV/Revenue based on a three-stage DCF model and peer comparisons.

The brokerage expects Meesho’s revenue to grow at a 31% CAGR between FY25 and FY28, driven by the deep value-commerce penetration and logistics efficiencies. The report also emphasized Meesho’s zero-commission, low-AOV, discovery-led platform catering to Tier-2 and Tier-3 users, along with its advantages in user growth and operational scale.

Meesho’s EBITDA is projected to turn positive by FY27E. Currently, the company trades at 2.4x FY28E EV/Revenue, well below the peer average of 5.4x, indicating room for the stock’s value to rise as the company’s performance improves.

By this rally, Vidit Aatrey, co-founder and CEO of Meesho Ltd, became a billionaire on Tuesday as the company’s shares kept rising after its stock market debut. The shares went up by as much as 13.3% to Rs 193.50, giving investors a total gain of over 74% since the IPO.

The steep rise in Meesho’s stock has made Aatrey a billionaire. He owns 11.1% of the company, or 47.25 crore shares, giving him a net worth of Rs 9,142.87 crore (around $1.005 billion). Co-founder Sanjeev Barnwal, who holds 31.6 crore shares, now has a stake worth Rs 6,114.6 crore.

Financials & Others

The company has shown fluctuating financial performance in recent years. Total Income increased from Rs. 5,897.69 crore in FY23 to Rs. 7,859.24 crore in FY24, then increased to Rs. 9,900.90 crore in FY25, with Rs. 5,857.69 crore recorded for the quarter ended September 30, 2025.

Profit After Tax (PAT) remained negative but showed signs of improvement, with a loss of Rs. 1,671.90 crore in FY23, reducing to a loss of Rs. 327.64 crore in FY24, then a larger loss of Rs. 3,941.71 crore in FY25, and a loss of Rs. 700.72 crore for the quarter ended September 30, 2025.

Meesho Limited, Incorporated in 2015, is a multi-sided technology platform driving e-commerce in India by connecting four key stakeholders: consumers, sellers, logistics partners, and content creators by operating under the brand name Meesho, the company enables consumers to access a wide range of affordable products while offering sellers a low-cost platform to grow their businesses.

The company has demonstrated strong operational growth, with a steady rise in placed orders and a broadening base of transacting users and sellers. For the twelve months ended September 30, 2025, Meesho reported 706,471 annual transacting sellers and 234.20 million annual transacting users.

Written by Sridhar J 

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