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Domestic institutional investors increased their exposure to Meesho in the first quarter of FY27, offsetting stake sales by several early foreign backers after the ecommerce company’s post-IPO lock-in period ended. 

According to the ecommerce major’s shareholding pattern for the quarter ended June, foreign company holdings (excluding FPIs and foreign nationals) declined to 62.05% of the diluted share capital from 65.51% at the end of March. During the quarter, 17 foreign companies exited the company’s cap table, reducing the total number of such investors to 50.

The ecommerce company’s post-IPO lock-in expired on June 9, making nearly 68% of its outstanding equity eligible for trading, according to data compiled by Nuvama Alternative & Quantitative Research.

A day later, Fidelity, through its investment entities FID FDI 2117 LLC and FID FDI 312 LLC, sold 5.98 Cr shares via bulk deals. Separately, Astrend India offloaded another 1.06 Cr shares during the quarter.  

While marquee investors such as Peak XV Partners, SoftBank, Prosus, Elevation Capital and RPS Ventures retained their holdings, smaller foreign shareholders collectively sold 16.68 Cr shares during the period. 

On the other hand, domestic institutional investors stepped up their buying. 

Mutual funds increased their holdings by more than 15.18 Cr shares during the quarter. At the end of June, 27 mutual funds collectively held a 7.93% stake in Meesho, up from 4.72% held by 23 schemes at the end of March.  

Among them, SBI Mutual Fund emerged as the largest domestic institutional shareholder with a 3.01% stake, while Invesco India Mutual Fund and Aditya Birla Sun Life Mutual Fund each held more than 1%.  

Domestic alternative investment funds (AIFs) also increased their exposure, with their holdings rising to 3.74 Cr shares across 29 funds from 2.59 Cr shares held by 18 AIFs in the previous quarter. 

Overall, domestic shareholders owned 8.89% of Meesho, or 42.13 Cr shares, at the end of June, compared with a 5.55% stake, or 25.35 Cr shares, three months earlier. 

The shift mirrors a broader trend emerging across India’s listed new-age technology companies, where domestic institutional investors are increasingly replacing foreign venture capital funds on company cap tables after IPO lock-in periods expire. 

Paytm is among the most prominent examples. The fintech major, which went public in 2021, saw domestic shareholding cross the 50% mark this year after foreign investors reduced their holding to 49.4% in the March quarter. Domestic investors further increased their ownership in the June quarter. 

A rising domestic ownership base is often viewed as a positive for listed new-age tech companies as it reflects growing confidence among local institutional investors, reduces dependence on foreign capital and provides greater stability to the shareholder base. 

Shares of Meesho ended today’s trading session 1.9% lower at ₹185.60.

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