The US-based asset management company Fidelity has once again lowered the valuation of Meesho on its books, now assessing the e-commerce startup at $3.5 billion.
This represents a 29% decrease from Fidelity’s highest valuation of $4.9 billion for Meesho.
In December 2023, the asset manager reviewed its investment in the ecommerce unicorn, valuing it at $27.8 million. This marked a decline from the initial investment of $41.9 million made in the latter half of 2022 through a designated mutual fund unit, as reported by TechCrunch.
It is worth mentioning that Fidelity previously reduced Meesho’s valuation to $4.1 billion by the end of October.
Meanwhile, commenting on the latest valuation markdown, a Meesho spokesperson said, “Funds attribute value to their portfolio investments, considering various factors such as the valuation of comparable companies. Based on Fidelity filings, the number of shares held and the current number of total outstanding fully diluted shares, the valuation is assessed at $3.5 Bn. The increase in the number of outstanding shares, notably due to the ESOP pool expansion, could have contributed to this valuation shift.”
Over the past year, Fidelity has consistently reevaluated the valuations of its Indian portfolio startups. In April 2023, Meesho’s valuation was reduced by 9.7% to $4.4 billion, followed by an internal upward adjustment of 5.41% in July.
In October 2023, the US-based firm also adjusted the valuation of the payments solution platform Pine Labs to $3 billion, down from $4.7 billion at the end of August. The fintech startup had previously achieved a valuation of over $5 billion after securing a $150 million funding round in 2022.
It’s important to highlight that valuation methodologies vary from investor to investor, and a reduction in valuation by Fidelity doesn’t automatically imply a negative perception from other investors. Nevertheless, there could be a cascading impact.
Meanwhile, the e-commerce unicorn Meesho is considering the development of a financial services platform and expanding its grocery delivery business in the upcoming financial year.
Continue Exploring: Meesho diversifies strategy, set to launch financial services and expand grocery delivery for enhanced profitability
Established in 2015 by Vidit Aatrey and Sanjeev Barnwal, Meesho, once lauded as the epitome of social e-commerce, underwent a strategic shift in 2022 to transform into a marketplace. Among its investors are notable names such as SoftBank, Peak XV, Fidelity Investments, Prosus, and Meta.
In a recent report, brokerage Bernstein stated that Meesho is capturing market share and emerging as the fastest-growing e-commerce platform in India, driven by the robust growth observed in Tier II and III cities.
According to the brokerage, Meesho experienced a 32% year-on-year increase in its user base, reaching approximately 120 million average monthly users (MAUs) in December 2023.
Continue Exploring: Meesho fastest growing e-commerce player; GMV tops $5 Billion: Alliance Bernstein Report
