Meesho IPO Subscribed 3x on Day 2; Retail Portion 5x Booked as GMP Signals Strong Listing

The Meesho IPO continued its strong momentum on the second day of bidding, attracting significant interest from investors across categories. The ₹5,421-crore public issue of the SoftBank-backed e-commerce platform has already been subscribed to more than 3 times its total offer size by 11 am on December 4, reflecting strong demand in the market despite concerns around profitability.

The robust subscription numbers come even as the Grey Market Premium (GMP) has seen a slight dip in recent days. However, analysts note that it still points toward a potentially strong listing for Meesho.

Subscription Status: Retail Leads With Heavy Buying

As per NSE data available at 11 am, Meesho received bids for 83.97 crore shares against the 27.79 crore shares on offer. This puts the overall subscription at over 3x, driven predominantly by retail investors.

Category-wise subscription on Day 2 (so far):

• Retail Investors: 5.34 times (534%)

• Non-Institutional Investors (NII): 3.23 times (323%)

• Qualified Institutional Buyers (QIB): 2.13 times (213%)

Retail investors have clearly taken the lead, exceeding their reserved quota by more than five times. NIIs have also shown strong appetite, while QIB participation has begun to pick pace ahead of the final bidding day.

Key Details of the Meesho IPO

The Meesho IPO seeks to raise ₹5,421 crore, comprising:

• Fresh issue: ₹4,250 crore

• Offer for Sale (OFS): 10.55 crore shares from existing shareholders

The price band has been set at ₹105–111 per share, valuing the company at nearly ₹50,096 crore at the upper end.

Lot Size & Minimum Investment

• Minimum shares per lot: 135

• Minimum amount (upper band): ₹14,985

The IPO is seen as one of the most awaited digital-sector listings of recent years due to Meesho’s rapid scale-up in India’s competitive e-commerce market.

Grey Market Premium Shows Strong Listing Expectations

According to data from Investorgain:

• Current GMP: 40.54%

• Previous GMP (Dec 2): 44.14%

While the GMP has slightly reduced, it still signals a healthy premium and strong investor confidence ahead of listing. This suggests high expectations for a positive debut for Meesho shares.

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Analysts’ View: Strong Scale but Profitability Concerns

Meesho operates in a highly competitive e-commerce landscape dominated by players like Amazon and Flipkart. Analysts remain divided on whether Meesho’s fast scale can convert into predictable profitability.

Concerns highlighted by Abhinav Tiwari, Bonanza:

• Meesho posted adjusted EBITDA losses of ₹5,518 crore in H1 FY26.

• Contribution margins fell to 3.8% in H1 FY26 from 5.6% in FY24.

• Heavy spending continues on marketing and technology.

• The company’s fundamentals remain “weaker” compared to larger rivals.

He noted that despite handling 1.8 billion annual transactions, Meesho’s path to sustainable profitability still remains uncertain, making it a high-risk investment for some categories of investors.

A Different View: Strong Cash Flow Discipline & Untapped Market

Contrary to bearish views, Ravi Singh from Master Capital Services highlighted Meesho’s strengths:

• The company is demonstrating strong cash-flow discipline.

• Growth is driven by deep value penetration in markets not fully served by mainstream e-commerce players.

• A significant chunk of demand comes from first-time online buyers in smaller towns.

Singh suggested that Meesho has differentiated itself by tapping into buyer segments more focused on affordability and variety than brand identity — giving it a distinct competitive advantage.

He added that profitability is possible but will be gradual, making this IPO more suitable for long-term investors rather than those seeking quick returns.

Brokerage View: ‘Subscribe for Long Term’

Domestic brokerage Angel One has assigned a ‘Subscribe for long term’ rating to the Meesho IPO.

Key points from Angel One:

• At the upper price band, Meesho’s valuation stands at ~₹50,096 crore.

• Since the company is loss-making, P/E is not meaningful.

• The IPO implies a 5.3x FY25 price-to-sales valuation.

• Meesho has a robust GMV run-rate of $6.2 billion.

• Marketplace contribution margin showed improvement at 3.8% of NMV in H1 FY26 (though still lower YoY).

Angel One added that despite strong GMV momentum, near-term profitability could remain volatile, and the IPO is suitable primarily for investors with high risk appetite and long-term outlook.

Should You Apply?

Based solely on the information provided:

Positives:

• Strong Day 2 subscription across all categories

• Healthy GMP indicating good listing prospects

• Strong transaction volume and market reach

• Growing demand from smaller towns and new-to-online buyers

• Positive view from brokers for long-term investors

Risks:

• Large losses in H1 FY26

• Declining contribution margins

• High competition from established e-commerce giants

• Heavy cash burn on marketing and technology

Conclusion:

The Meesho IPO appears to be gaining strong traction in the market, with retail investors driving the momentum. GMP signals a positive listing, but the business remains loss-making with unstable profitability patterns. Based on analysts’ commentary, this IPO may be more suitable for long-term, high-risk investors rather than short-term traders.

Disclaimer

Disclaimer: The views, opinions, and investment remarks mentioned by market experts in this article are solely their own and do not represent the views of this website or its management. This article is strictly for informational and educational purposes based on the data provided in the source material. It should not be considered investment advice.
Readers are strongly advised to consult certified financial advisors before making any investment decisions.

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