Meesho shares slip 0.5% post-results; analysts split on valuation

Meesho's shares edged down 0.50 percent on Thursday following the company's Q2 FY27 earnings release on October 28. Despite reporting a narrowing of net losses, the stock opened at ₹222 and climbed to a high of ₹232.50 that day. The sell-side order flow outnumbered buy-side orders, with 77 percent of pending orders on the sell side compared to 23 percent on the buy side.

Around 89 lakh shares changed hands, totaling ₹203 crore in value. The stock has risen nearly 25 percent year-to-date but is still below its 52-week high of ₹254.40, reached in December 2025. Analyst opinions are split on Meesho's valuation. Motilal Oswal and Choice Institutional maintained Buy ratings with a target price of ₹265, highlighting logistics-driven margin expansion and long-term growth potential.

Elara Securities kept an Accumulate rating with a target of ₹270, emphasizing that profitability improvement, rather than one-time efficiency gains, will be crucial for a price re-rating. JM Financial's lone recommendation was to Sell, maintaining a target of ₹185 and citing the stock's high multiple of 60 times FY29 adjusted EBITDA, which limits upside potential if execution falls short.

The discrepancy in analyst views stems from Meesho's guidance that its 6 percent contribution margin, achieved in Q2, may not persist as the company plans to reinvest logistics savings into seller and consumer subsidies ahead of the festive season. The company narrowed net losses by around 68 percent year-on-year to ₹132 crore, while Net Merchandise Value grew 23 percent to ₹12,911 crore.

On a festival-adjusted basis, NMV growth was 33 percent. Quarterly free cash flow turned positive at ₹345 crore, buoyed by seasonal working capital. The company ended September 30 with a cash balance of ₹7,048 crore.