The shares of recently listed e-commerce giant Meesho extended their spectacular post-listing rally on Wednesday, December 17, climbing over 10.5% during the day's trading to establish a new all-time high. The stock touched a peak of ₹199.35 on the National Stock Exchange (NSE), marking its second consecutive session of record highs and the third straight day of gains.
UBS Bullish Note Fuels Record Rally
The latest surge in Meesho's share price was primarily driven by a highly optimistic research note from global brokerage firm UBS. The brokerage initiated its coverage on Meesho with a Buy rating and set a target price of ₹220. This target suggests a potential upside of nearly 10% from the stock's peak level reached on Wednesday.
UBS expressed strong confidence in Meesho's business model and future prospects. In its report, the brokerage highlighted the company's asset-light operational structure, robust user growth, and consistent improvement in financial metrics as key strengths. UBS particularly noted that Meesho's negative working capital model, which supports cash flow generation, distinguishes it from many other internet-based companies.
"We believe Meesho’s asset-light, negative working-capital business model positions it well for sustained profitability," UBS stated. The brokerage forecasts strong growth, supported by a 30% compound annual growth rate (CAGR) in Net Merchandise Value (NMV), increasing user engagement, and rising order frequency through the fiscal year 2030.
Meesho's Meteoric Rise Since IPO
Meesho made a blockbuster debut on the stock exchanges last week, listing at a massive premium. The stock began trading on the NSE at ₹162.50, a jump of 46.40% over its issue price of ₹111. On the Bombay Stock Exchange (BSE), it listed at ₹161.20, a gain of 45.22%. With today's intraday high of ₹199.35, Meesho has now delivered a staggering 79% return to investors from its initial public offering (IPO) price.
The rally this week has been particularly impressive. Meesho's share price has climbed 5.6% and 3.4% in the last two sessions, resulting in a remarkable 21% surge over just three trading days.
Financial Projections and Growth Drivers
UBS has outlined a robust growth trajectory for Meesho in its analysis. The brokerage expects the company's Net Merchandise Value to expand at a 30% CAGR between FY25 and FY30. This growth is projected to be fueled by a sharp increase in Annual Transacting Users (ATUs) from 199 million to 518 million.
Furthermore, order frequency is anticipated to improve significantly from 9.2 times to 14.7 times over the same period. As Meesho passes on logistics efficiencies to its ecosystem, the Average Order Value (AOV) is expected to see a calibrated decline from ₹274 to ₹233. UBS forecasts the contribution margin to reach 6.8%, with the adjusted EBITDA margin hitting 3.2% of NMV by FY30.
IPO Details and Company Fundamentals
The Meesho IPO, which raised ₹5,421 crore, witnessed overwhelming demand from investors. The issue was subscribed a massive 79.02 times at closing. The price band was set at ₹105–₹111 per share. The offer comprised a fresh issue worth ₹4,250 crore and an offer for sale (OFS) of 10.55 crore shares valued at ₹1,171 crore.
The company plans to utilize the net proceeds from the fresh issue to fund investments in cloud infrastructure, brand building, marketing initiatives, and pursuing inorganic growth opportunities like acquisitions and strategic partnerships. A portion will also be allocated for general corporate purposes.
Meesho has established itself as India's largest e-commerce platform by annual transacting users and order volumes for the twelve months ending September 30, 2025. Its value-focused model, offering low-priced products, has attracted a high-frequency shopper base.
While the Average Order Value has declined from ₹336.71 in FY23 to ₹274.27 in FY25 as part of its affordability strategy, the total number of orders has skyrocketed from 102.4 crore to 183.4 crore in the same period. Annual Transacting Users grew at a 20.7% CAGR, rising from 13.6 crore to 19.8 crore between FY23 and FY25.
The platform demonstrates exceptional user engagement, recording 13.53 billion average daily product views in FY25. A key strength of its discovery-driven model is that 73.18% of orders in the six months ended September 2025 were generated through personalized feeds and recommendations.
Disclaimer: The views and recommendations mentioned are those of individual analysts or broking companies. Investors are advised to consult certified experts before making any investment decisions.
