Blasé Capital POST-LISTING PAINS

It made a grand debut on the stock exchanges. It showed a promising listing gain, followed by a further boost to the share price. Within a few trading sessions, it crossed the INR 250 mark, which marked a stupendous rise over the issue price of INR 111, and listing price of INR 162. On January 8, 2026, it was nearer to the listing price. For two sessions in a row, it hit the five per cent lower circuit. Since an intraday price of nearly INR 187 at noon on Monday (January 5), it is down by nearly INR 22, or a fall of almost 12 per cent. It listed with a gain of 46 per cent over the offer price, zoomed by 135-140 per cent, and corrected more than 30 per cent from the recent highs. Yet, the stock still rules 50 per cent or so over the offer price.

Several reasons explain this rise and fall of Meesho, an e-commerce platform. These include those related to the sector, and those linked to the company. In the recent past, analysts have expressed concerns over the high valuations of the new-age firms, both in India and globally. Hence, a re-rating was expected. In India, the issue became more complex as quick commerce players such as Zomato, Swiggy, Blinkit, and others faced the ire of their delivery people. On December 25 and December 31, 2025, the delivery boys and girls went on partial strikes across the nation. They questioned the quick-delivery business models, and management practices. They questioned the safety of the delivery people, and said that they were forced to, and penalised for, delays, which occurred at the sellers’ or buyers’ end. Employers based the incomes on opaque algorithms that normal people did not understand, which led to unsteady earnings.

When the founder of one of the quick commerce firms gave a detailed analysis that questioned the demands of the delivery boys, he was criticised, and re-questioned. The original analysis explained that the delivery persons are paid just over INR 100 for every hour they clock on the app. At 10 hours a day, for 26 days a month, this translated into an income of more than INR 26,000, which came to INR 21,000 after adjusting for costs related to fuel and maintenance of their vehicles. (The insurance for the vehicles was paid by the firm.) According to the founder, INR 21,000 is a decent income. The figures were disputed in a media report. “In a year, the average Zomato delivery worker puts in 38 days, seven hours per working day. Only 2.3 per cent worked more than 250 days (in a year). If gig work is a decent halfway house between abject poverty, and a formal sector that has few jobs to offer, surely more people will try to maximise their earnings from the platform,” stated an article.

Obviously, such criticisms extended beyond quick commerce, and engulfed other online sellers. Meesho was plagued with issues that linked with the events within, and linked to the company. In the past two days, investors were rattled by the news that a senior general manager resigned, which caused the share to plummet. Then came the news that the one-month lock-in period for the pre-IPO (Initial Public Offering) institutional investors expired, and more than 20 million shares of Meesho were available for sale in the secondary market. This flummoxed the investors, who expected a sale spree to take advantage of the higher-than-offer price. Although one is not sure, the expectation is that some of the pre-IPO investors may offload a part of their holdings, or completely exit. Indeed, since the stock reached a high of INR 250, existing shareholders have sold to book the high profits within a few days, and weeks.

As analysts explained before the IPO, the offer-price valuation, and subsequent listing and post-listing gains were based on revenues, and not profits. In 2024-25, Meesho reported a net loss of nearly INR 4,000 crore due to “one-time transition-related taxes.” In the first half of 2025-26, the loss came down to INR 700 crore, even as the half-yearly revenues rose by INR 1,200 crore to more than INR 5,500 crore on year-on-year basis. This explains why some brokerage houses still retain a buy the stock, with a target price of INR 200. However, this price is a quarter less than the high it reached in December 2025, although it is more than 80 per cent over the offer price. However, Meesho’s yo-yo in the stock exchanges makes one wary, or at least slightly careful about being invested in new-age firms. The quick delivery stocks have lost 20 per cent or so in the recent past.

According to some analysts, the investors’ focus has shifted from “growth at any cost (or revenue-based models)” to profits and cash flows. Hence, the buyers prioritise a “clear path to breakeven, and controlled cash burn over pure revenue growth.” This partially explains the recent corrections in the prices of new-age stocks, and a dilution in aggressive valuations. In comparison, firms with strong fundamentals, and future operations can justify higher prices. The overall market sentiment, concur analysts, has “cooled off from peak exuberance… towards more cautious investing.”