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E-commerce unicorn Meesho has received approval from the Securities and Exchange Board of India(SEBI) for its initial public offering (IPO).The green light comes after the market regulator observed Meesho's confidential Draft Red Herring Prospectus (DRHP) on October 10. The approval marks a major step in the company's journey toward listing on Indian exchanges. Earlier this year, Meesho submitted its draft documents after moving its holding structure from the US to India. The strategic move was aimed at complying with domestic listing norms and simplifying compliance processes. The company's DRHP reveals plans to raise ₹4,250 crore through a fresh issue and an Offer for Sale (OFS) of up to 175.7 million shares by existing shareholders. Meesho is also considering a pre-IPO placement of up to ₹850 crore, which would proportionately reduce the size of the public issue. Several prominent backers are planning partial exits with Elevation Capital selling around 5.54 crore shares, Peak XV Partners (formerly Sequoia Capital India) about 3.05 crore shares, and Venture Highway around 1.57 crore shares in the upcoming IPO. Meesho's founders, Vidit Aatrey and Sanjeev Barnwal, will also be a part of the OFS, each selling 1.18 crore shares. This would be their first-ever secondary sale since founding the company nearly a decade ago. The proceeds from the IPO will be used to upgrade cloud and tech infrastructure, invest in AI and engineering talent, expand marketing efforts, and for acquisitions/general corporate purposes. In FY25, Meesho's revenue grew 23% year-on-year (YoY) to ₹9,389.9 crore, driven by its core marketplace business. However, the company also reported a net loss of ₹3,941.7 crore due to tech investments and ESOP costs, among others. Despite these challenges, Meesho ended FY25 with over ₹5,700 crore in cash and investments while remaining debt-free, a sign of a healthy balance sheet ahead of its listing.
