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Meesho Drops 23% in Three Sessions, Hits Lower Circuit as Post-IPO Rally Unravels

A thin float with wary views on valuation is fueling the pullback.

Overview

  • On Tuesday, the shares hit the lower circuit near Rs 185.34 and closed around Rs 187, leaving the stock down about 23% across three sessions and the market value below Rs 85,000 crore.
  • Exchange data cited by Reuters showed 4.9 million shares changing hands across nine block deals on the NSE at a 3% to 10% discount to the previous close.
  • A public float of roughly 6% has amplified price swings, following last week’s short-covering and a reported exchange auction of over one crore undelivered shares.
  • Broker commentary points to stretched valuations and an unclear path to sustainable profitability, with some analysis referencing about 40x forward EV/EBITDA.
  • Investors are watching the Jan. 7 lock-in expiry for roughly 11 crore shares that could lift tradable supply, even as UBS initiated a Buy with a Rs 220 target and Fidelity disclosed a 6.3% stake.