Meesho Shares Crash 28% Post-IPO: Valuation Fears Trigger Sell-Off
A Rollercoaster Debut for Meesho
The focus keyword: Meesho shares has dominated market chatter this week. After a spectacular IPO debut earlier in December 2025, where Meesho listed at a 46% premium over its issue price of ₹111, the e-commerce unicorn’s stock has now tumbled over 28% from its peak of ₹254.40.
On December 23, Meesho shares fell intraday by more than 8%, closing near ₹185.34, extending a three-session decline of 21%. The sell-off has rattled retail investors who piled into the IPO, which was subscribed 79 times overall, including 19 times by retail investors.
Why Are Meesho Shares Falling?
Analysts point to several factors behind the sharp correction:
- Valuation Concerns: Meesho’s market cap briefly crossed ₹91,000 crore, raising questions about sustainability given its thin profitability.
- Low Free-Float Volatility: With only 6% free-float, price swings have been magnified, making the stock prone to circuits.
- Profitability Timeline: While Meesho has shown strong revenue growth, analysts remain cautious about when it will achieve consistent profits.
- Post-IPO Euphoria: The initial rally was driven by momentum traders, but long-term investors are now reassessing fundamentals.
Analyst Views
- UBS initiated coverage with a ‘Buy’ rating and a target of ₹220, citing strong growth potential but warning of volatility.
- Other brokerages flagged valuation risks and advised caution until Meesho demonstrates clearer profitability.
- Market experts suggest the correction is healthy, cooling off speculative froth after the IPO surge.
Meesho’s Business Model Under Scrutiny
Meesho, known for its social commerce and low-cost marketplace model, has disrupted India’s e-commerce space by empowering small sellers and resellers. However, challenges remain:
- Thin margins in fashion and lifestyle categories.
- High competition from Flipkart, Amazon, and Reliance JioMart.
- Dependence on discount-driven growth, which pressures profitability.
Despite this, Meesho’s asset-light model and focus on Tier-2 and Tier-3 cities continue to attract investor interest.
What Investors Should Watch
- Quarterly Earnings – Will Meesho show a path to profitability in FY26?
- Regulatory Environment – E-commerce rules and FDI policies could impact growth.
- Free-Float Expansion – More shares in circulation may reduce volatility.
- Competition Response – Rivals may intensify discount wars, squeezing margins further.
Trending Queries
- Why are Meesho shares falling after IPO?
- What is Meesho’s current share price?
- Is Meesho a good long-term investment?
- What analysts say about Meesho valuation?
- Meesho IPO subscription details
CTA Links
- Latest News
- Top Stories
- ET World
- Wikipedia: Meesho
- NSE India Meesho Stock
- Quora: Should you invest in Meesho IPO?
🔗 More updates: Twitter | Telegram | IndiaWorld.in
Also Read: From Army to Bigg Boss: Kalyan Padala’s Inspiring Journey to Victory
