Meesho turns profitable with order volume rising 43% and revenue up 54%
Meesho said it has turned profitable at a consolidated profit after tax (PAT) level, encompassing all costs (including ESOP) across all its divisions and categories.
Ecommerce marketplace Meesho on August 7 announced that it has become the first horizontal e-commerce firm in India to turn profitable. Though the company did not disclose its absolute profit figure, a person close to the development, told CNBC-TV18 that it was “in single digit,” indicating it was under Rs 10 crore.
Meesho said it has turned profitable at a consolidated profit after tax (PAT) level, encompassing all costs (including ESOP) across all its divisions and categories.
In the last 12 months, the venture has seen order volumes grow by 43 percent, culminating in over a billion orders. Eighty five percent of the orders came from returning users, orders in the non-fashion categories also surged by over 120 percent in this period and the venture claims that every category is profitable on a standalone basis. The revenue over the last 12 months has surged by 54 percent, driven by substantial growth in order volumes and monetisation rate.
Despite significant reductions in customer acquisition cost and marketing spends by 80 percent (YoY), Meesho claims it remains the most downloaded shopping app in India. Serving over 140 million unique transacting users in the last 12 months, the firm has also recorded a 60 percent YoY reduction in tech costs, further bolstering its operational efficiency.
With a current run rate of 3.5 million orders per day, the company believes that its capital efficiency, attributed to the structural advantage of its innovative and asset-lite business model is what drove profitability.
Vidit Aatrey, CEO and Founder at Meesho, said “As the first horizontal e-commerce platform to achieve profitability in India, we remain committed to driving sustainable growth, democratising e-commerce for everyone and unlocking the true potential of India's heartland.”
Meesho operates on a zero commission model, providing a lucrative proposition for its sellers who happen to be small businesses and individual entrepreneurs. Its strategic focus on servicing tier 3 and tier 4 cities has helped the company extend its reach to new-to-e-commerce users.
With a vision to enable 100 million small businesses, including individual entrepreneurs, to succeed online, Meesho aims to democratise internet commerce and bring a range of products and new customers online.
The Meesho marketplace provides small businesses, which includes SMBs, MSMEs and individual entrepreneurs, access to millions of customers, selection from over 30 categories, pan-India logistics, payment services and customer support capabilities to efficiently run their businesses on the Meesho ecosystem.
First Published: Aug 7, 2023 2:42 PM IST
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