Meesho shares trade flat even as Q2 loss narrows to Rs 132 crore; brokerages remain mixed

Consolidated revenue from operations grew around 34 percent to Rs 4,131.5 crore in the reported quarter from Rs 3,073.6 crore in the corresponding period of the preceding fiscal, the company said in an exchange filing. Brokerages had mixed views on the stock following the quarterly results. Nomura maintained a 'Reduce' rating on Meesho with a target price of Rs 167, citing a mixed performance in the second quarter of FY27.

The brokerage said investments offset contribution margin gains at the adjusted EBITDA level and expected the improvement in contribution margin to reverse in the December quarter of FY27. It added that the management had kept its net merchandise value (NMV) compound annual growth rate (CAGR) guidance of 25 percent for FY26-30 unchanged. Nomura said the stock was trading at 1.4 times and 1.2 times its enterprise value to NMV for FY28 and FY29, respectively.

Jefferies, meanwhile, maintained a 'Buy' rating on the stock with a target price of Rs 285. The brokerage said NMV grew 23 percent year-on-year and more than 30 percent on a festive-adjusted basis, signalling a strong December quarter. It noted that the contribution margin reached a multi-quarter high, supported by logistics gains, including faster deliveries, lower returns to origin (RTOs) and rising delivery density.

Jefferies also said core losses narrowed sharply in absolute and percentage terms. The management remained confident of achieving around 25 percent NMV CAGR through FY31, with margins expected to improve steadily. However, the company continued to prioritise growth and focus on offering value to customers rather than accelerating monetisation, the brokerage said. Meesho Chairman, Managing Director and Chief Executive Officer Vidit Aatrey said the second-quarter performance reflected the strength of the company's operating model.

NMV grew 23 percent year-on-year to Rs 12,911 crore, while annual transacting users reached 28.4 crore, he said. "More consumers are shopping on Meesho and they are shopping more frequently, even as first-time buyers grew 16 per cent quarter-on-quarter. This momentum extended into the festive season, with NMV growing 33 per cent year-on-year on a festive-aligned basis. As we grow, the benefits of scale are increasingly translating into stronger platform economics," Aatrey said.