E-commerce startup Meesho shares first-ever profit, eyes IPO in 12 to 18 monthstext_fields
Bengaluru: Indian e-commerce platform Meesho has achieved a significant milestone by posting its first-ever profit and is now aiming for an initial public offering (IPO) within the next 12 to 18 months, said a senior company executive.
Meesho, founded by Vidit Aatrey and Sanjeev Barnwal, has become a strong competitor in India's rapidly growing e-commerce market, taking on giants like Amazon and Walmart's Flipkart. The platform's success can be attributed to its focus on smaller towns and cities, offering unbranded products such as clothes and cosmetics.
PitchBook data shows that Meesho was last valued at nearly $7 billion (approximately Rs. 57,930 crores).
After facing losses since its inception in 2015, Meesho finally turned the tables last month and recorded a profit, as confirmed by the company in a statement. The revenue for the first half of the year (January-June) exceeded $400 million (approximately Rs. 3,300 crores), and the company expects it to reach $800 million (approximately Rs. 6,620 crores) by the end of the year, said Chief Financial Officer Dhiresh Bansal to Reuters.
Bansal stated, "Since we just turned from negative to positive, it's a small nominal kind of number, single digit of course... We intend to continue the profitability trajectory," without divulging specific figures.
Looking ahead, Meesho is now planning an IPO within the next 12 to 18 months. Bansal explained, "We feel that the growth, scale, and profitability are there (for an IPO), but you also want to make sure that there is enough of a track record for market investors to look at."
Founded by graduates from the Indian Institute of Technology, Meesho has achieved remarkable success, fulfilling over 1 billion orders in the past 12 months.
Meesho's accomplishment of posting its first profit comes amidst a challenging funding landscape for Indian startups. Many have struggled to raise funds due to a funding squeeze exacerbated by higher interest rates and a global tech market downturn. In response, numerous Indian startups have taken cost-cutting measures, including laying off thousands of employees.