Meesho shares hit 5% lower circuit after its loss widens in Q3; Check details

Synopsis: Shares of Meesho Limited hit a 5% lower circuit after Q3 FY26 losses widened to Rs 491 crore despite strong revenue growth and robust user, order, and GMV momentum, highlighting near-term profitability concerns amid rapid scaling.

The shares of this company, which is an app-based marketplace that is operated under the brand of Meesho that connects sellers and end consumers and whose offerings span categories including fashion, accessories, electronics, home and kitchen items, health and fitness equipment, and office supplies, had its shares crash after the Q3 loss widened.

With the market cap of Rs 74,602 crore, the shares of Meesho Ltd have crashed about 5% hitting the lower circuit and reaching a low at Rs 165, compared to their previous day’s closing price of Rs 173.95.

About the Q3 Result

The revenue from operation for the company stood at Rs 3,518 crore when compared to Rs 2,679 crore in Q3 FY25, growing by about 31 per cent on a YoY basis and on a QoQ basis increasing by 14 per cent from Rs 3,074 crore in Q2 FY26.

The net loss grew on a YoY basis when you compare the Q3 FY26 loss at Rs 491 crore to the Rs 37 crore loss in Q3 FY25 and on a QoQ basis has increased from the Rs 411 crore loss in Q2 FY26. 

On a positive side, the company has delivered user and order growth. Placed orders increased 36% YoY to 690 million, and annual transacting users rose 34% YoY to 251 million, making Meesho the largest Indian e-commerce company on both parameters. The increase in purchase frequency (9.78x per annum) is a positive indication of improving user engagement and repeat business, particularly in the underpenetrated markets.

The company’s growth story has been reflected in its robust GMV performance, with Net Merchandise Value (NMV) reaching Rs 10,995 crore, a 26% increase from the same period last year. Adjusting for the shift in the festive calendar, Meesho’s combined Q2-Q3 FY26 NMV grew 37% YoY to Rs 21,510 crore, a strong indicator of demand. Meesho’s lean and efficient marketplace business model has been instrumental in the company’s scale-driven operating leverage and its ability to offer affordable products to value-seeking consumers.

Operational efficiency and technology spend further improved fundamentals. AI-based recommendations, voice search, and regional language interfaces enhanced first-time user acquisition and engagement, and brand engagement on Meesho Mall increased use cases. Most significantly, Meesho announced positive LTM free cash flow of Rs 56 crore, aided by a negative working capital cycle, low capex, and a strong cash balance of Rs 7,277 crore.

Disclaimer: The views and investment tips expressed by investment experts/broking houses/rating agencies on tradebrains.in are their own, and not that of the website or its management. Investing in equities poses a risk of financial losses. Investors must therefore exercise due caution while investing or trading in stocks. Trade Brains Technologies Private Limited or the author are not liable for any losses caused as a result of the decision based on this article. Please consult your investment advisor before investing.

The post Meesho shares hit 5% lower circuit after its loss widens in Q3; Check details appeared first on Trade Brains.