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US-based asset management company Fidelity has marked down the valuation of Meesho on its book, valuing the e-commerce start-up at $3.5 billion.
This marks a decline of 29 per cent from Fidelity’s peak valuation of $4.9 billion for Meesho.
“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 billion. The increase in the number of outstanding shares, notably due to the ESOP pool expansion, could have contributed to this valuation shift.” said Meesho’s spokesperson.
At the end of December 2023, the asset manager assessed its stake in the e-commerce unicorn at $27.8 million, marking a decrease from the $41.9 million initially invested during the second half of 2022 through a specific mutual fund unit,
Fidelity had cut down Meesho’s fair value to around $4.1 billion as on October 31, 2023, down from around $5 billion it had been assigned two months earlier. This adjustment in valuation happened in the aftermath of a secondary sale transaction last year, during which early investor Venture Highway sold a portion of its stake in Meesho to WestBridge Capital.
Fidelity had originally invested in Meesho in September 2021 in a funding round that had valued the firm at $4.9 billion.
In October, India-focused investment firm WestBridge Capital bought a stake in Meesho from Venture Highway, one of its early investors, at a valuation of around $3 billion in a secondary transaction.
Meesho had hit a gross merchandise value (GMV) run rate – or the estimated annual sales on the platform based on recent performance – of $5 billion as of January 2024, compared with market leader Flipkart’s $29 billion as of FY23, as per a report from Bernstein.
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