Meesho's stock prices rose as much as 8% on Thursday, May 7, after the e-commerce company announced improved profitability and healthy user growth in Q4FY26. The rally came as investors responded positively to the company’s narrowing losses and growth in order volumes.
The stock opened at Rs. 204.40 in early trade, and rose to an intraday high of Rs. 211.35 after the company reported that its consolidated net loss declined to Rs. 166.34 crore in Q4 FY26 as compared to a loss of Rs. 1,391.38 crore in the same quarter last year.
The revenue from operations increased by 47.13% YoY to Rs. 3,531.21 crore, driven by an increase in order frequency, more sellers being active, and a broader customer reach. With these trends, Meesho's consolidated net loss decreased to Rs. 1,357.73 crore from Rs. 3,941.70 crore in FY25 and its revenue grew by 34.4% to Rs. 12,626.34 crore for the full financial year.
The number of annual transacting users grew by 33% to 264 million, with orders up 45% YoY to 2.67 billion. Net merchandise value (NMV) grew 39% to Rs. 41,560 crore, which continued to show strength in the value-commerce side of the business in India.
Meesho founder and CEO Vidit Aatrey said that FY26 has strengthened the company's belief in the long-term growth prospects of the Indian e-commerce market.
Brokerages acknowledged the strength, but were cautious about the stock. JM Financial noted that Meesho has performed well on the operational front, coupled with improving profitability, and accelerated NMV growth. Marketplace NMV growth picked up in Q4 to 42.7% from 26.4% in Q3, the brokerage added, as logistics disruptions dampened contribution margin to 4% of NMV.
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After the result, JM Financial revised its FY27 and FY28 estimates and has also hiked its price target for the stock to Rs. 180 from the previous Rs. 155 by the end of March 2027. It still had a “REDUCE” rating, though.
Choice Institutional Equities also held a cautious stance, even as it noted improvements in user growth, seller additions, and order frequency. The brokerage noted that most of the positives in the near-term have already been priced in the stock, prompting it to downgrade the stock to “ADD” while maintaining a target price of Rs. 210.
Meanwhile, HSBC held a “hold” rating and noted that gains in logistics efficiencies, increased prepaid orders and advertising revenues will help long-term profitability. The brokerage believes that Meesho's free cash flow is likely to become positive from FY27 onwards.