Meesho’s Post‑Doubling Shakeout: Low Float, Profit‑Taking and Shorts Collide

’s 8% slide over two sessions, and a sharper 15–17% drop from its recent peak, is essentially the hangover after a euphoric, low‑float rally that saw the stock more than double from its IPO price in just seven trading days. After listing at ₹162 versus a ₹111 issue price and briefly crossing ₹1 lakh crore in market cap, the stock had surged about 110%, fuelled by heavy demand, short‑covering and a free float of barely 6%. The same technicals that amplified the upside are now exaggerating the correction. A prior short squeeze had already pushed over 1 crore shares into the auction mechanism as shorts failed to deliver, signalling stress in borrow availability and settlement. With some early investors and traders now locking in profits, limited supply is working in reverse—small selling volumes are producing outsized price damage. Fundamentally, the Street’s stance has not flipped. UBS and Choice Institutional Equities recently initiated coverage with bullish views, baking in around 30% NMV CAGR over FY25–30, user growth from 199 million to over 500 million and expanding monetisation via ads, fintech and fulfilment. The near‑term question, therefore, is less about business viability and more about how quickly the stock can find an equilibrium between frothy early‑stage valuations, low float and a market that has just lived through a spectacular, technically driven melt‑up. Source: The Economic Times No Recommendations