Meesho Surges 7% As E-commerce Firm Narrows Losses, Clocks Strong Order Growth

Mumbai, May 7:Shares of Meesho jumped sharply on Thursday after the e-commerce platform reported a steep narrowing of March-quarter losses, with investors cheering strong order growth, improving margins and signs that the company’s aggressive expansion strategy may be beginning to deliver operating leverage.

The stock pared gains as trade progressed. Source: NSE

The stock climbed as much as 7%, extending its recent rally and taking gains over the past month to nearly 38%. The counter, which was up 4% at Rs 202 at the time of writing, has also surged more than 80% from its IPO price of Rs 111 since listing in December last year, reflecting strong investor appetite for new-age internet companies showing a clearer path towards profitability.

Strong Show

Meesho reported an 88% year-on-year decline in consolidated net loss to Rs 166 crore for the March quarter, compared with Rs 1,391 crore a year earlier. Revenue from operations rose 47% to Rs 3,531 crore, while net merchandise value (NMV) climbed 43% to Rs 11,400 crore. Total orders during the quarter also surged 43% to 717 million, driven by continued user additions and stronger engagement from existing customers. 

The company’s improving profitability metrics also boosted sentiment on Dalal Street. Contribution margin improved to 4% of NMV, supported by lower logistics costs, better network optimisation and improving operating leverage as scale expanded. 

Enthusiasm had already been building ahead of earnings, with the stock gaining nearly 38% over the past month. Above is the price movement from 8 April till 6 May. Source: NSE

Investor enthusiasm around the stock had already been building ahead of earnings. Meesho had rallied sharply in recent weeks on expectations of stronger growth, monetisation opportunities through advertising and logistics services, and improving cash flow generation.

Technically Overheated

The company also underlined its growing use of artificial intelligence to drive efficiencies. Meesho said more than 70% of its code is now AI-generated, while AI tools are increasingly being deployed across logistics, product recommendations and customer engagement. Its vernacular AI shopping assistant “Vaani” reportedly crossed 1.5 million users within a month of launch. 

Despite the optimism, the stock appears technically overheated after its rapid rally, suggesting the possibility of near-term profit booking after the sharp run-up.

Source:

• https://www.nseindia.com/get-quote/equity/MEESHO/Meesho-Limited