While Meesho is much smaller in size (GMV terms) compared to Flipkart Group and Amazon India, its average monthly active users (MAUs) count is ~55 per cent of the incumbents, according to the latest report by Jefferies.
It added that Meesho had 120 million average monthly active users on its platform during CY22. Over the last two years, Meesho has added ~100m MAUs, much higher than additions by its peers.
Further, the company’s monthly transacting user count rose 26X over CY20-22, resulting in a 9X increase in GMV. Meesho clocked 1 billion orders, up 2.2X year-on-year, and 140 million transacting users in 2022. Meesho on-boarded 1 million sellers, with more than 600,000 small businesses signing up in the last year. The company achieved this feat within eight years of inception, driven by its zero commission model.
The report noted that Meesho’s contribution margin is positive (pre-marketing and indirect spends) and is nearing zero cash burn and is on track to achieve EBITDA breakeven over the course of CY23. The company’s ad income has risen sharply over the last eight quarters. It currently stands at 6 per cent of revenues, which the company intends to double over time.
Chief Financial Officer at Meesho, Dhiresh Bansal, said, “Over the last few quarters, we have seen rising traction with users across the country flocking to the platform. With economies of scale kicking in and our strong focus on profitable growth, we are close to becoming EBITDA positive. Our key business differentiators such as an asset-light business model have proven to be effective levers in this journey. On our mission to democratise e-commerce, we will continue to scale the business in a profitable and sustainable manner.”