SoftBank-backed Meesho’s shareholders have approved a proposal to issue 411.4 Cr bonus shares ahead of the ecommerce major filing its draft red herring prospectus (DRHP) with markets regulator SEBI.
As per the company’s MCA filings accessed by Inc42, the members, during an extraordinary general meeting held on May 31, approved the proposal to issue the bonus shares of INR 1 each to equity shareholders in the ratio 47:1.
Following the allotment, the paid up share capital of the company will increase to INR 420.1 Cr from INR 8.7 Cr earlier, the filing showed.
The Bengaluru-based ecommerce giant counts the likes of Tiger Global Management, Peak XV Partners, Prosus, Meta and Think Investments among its backers.
Meesho declined to comment on Inc42’s queries on the development.
The ecommerce major is said to be looking to raise nearly $1 Bn through its initial public offering (IPO) by the end of 2025. The startup has picked Morgan Stanley, Kotak Mahindra and Citi as bankers for its IPO. The bankers have reportedly pitched for a $10 Bn valuation for the public issue.
Last month, the company renamed its parent entity to Meesho Private Limited from Fashnear Technologies Private Limited to create a better brand recall among its stakeholders ahead of its eventual stock market listing. Fintech unicorn Moneyview, quick commerce unicorn Zepto and consumer services giant Swiggy made a similar move in the past.
Founded in 2015 by Vidit Aatrey and Sanjeev Barnwal, Meesho started as a social commerce startup. However, it transitioned to a marketplace model in 2022 to take on heavyweights like Flipkart and Amazon.
While Flipkart and Amazon are more popular in tier I cities, Meesho targets customers in tier II, III and beyond cities with unbranded products like cosmetics and clothing. The startup earns more than 80% of its revenue from these cities.
Interestingly, Meesho does not charge commission fees on its platform and instead relies on advertising and marketing income from sellers.
Overall, it has raised upwards of $1.6 Bn in funding to date and also counts Mars Grow Capital, Elevation Capital and Trifecta Capital among its investors.
While the ecommerce platform is yet to disclose its FY25 numbers, it managed to narrow its standalone net loss by 82% to INR 305 Cr in FY24 from INR 1,675 Cr in the previous fiscal year.
Operating revenue jumped nearly 33% to INR 7,615 Cr during the year under review from INR 5,734.5 Cr in FY23.
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