meesho: Fidelity cuts fair value of Meesho, Pine Labs

Funds managed by financial services giant Fidelity have marked down the valuations of ecommerce marketplace Meesho and fintech firm Pine Labs, according to filings made with the US Securities and Exchange Commission (SEC).

As per the filings, Fidelity’s funds have set Meesho’s fair value at around $4.1 billion as of October 31, 2023, down from around $5 billion as of end-August. Meesho was last valued at $4.9 billion after raising $570 million in 2021.

Meanwhile, fintech platform Pine Labs’ fair value was cut to $3 billion as of end-October, from $4.7 billion as of August 31. The Peak XV Partners-backed company was valued at over $5 billion after it raised $150 million in 2022.

On January 4, ET reported that US-based investor Invesco had cut the valuation of Pine Labs to $3.9 billion as of October 31.

Crossover funds, which invest both in publicly-traded and privately-held companies, periodically review the valuation of their portfolio companies. Among various factors, revisions in valuations by investors in privately-held firms often reflect the changes in their public market counterparts.

Pine Labs CEO Amrish Rau refused to comment on the development. An email query sent to Meesho did not elicit a response at the time of publishing.

On January 2, ET reported that angel investors and early institutional shareholders of Meesho are in talks with investors to sell their stake in the Bengaluru-based company. These discussions are happening for a transaction at a valuation of $3-3.5 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.

For the year ended March 2023, both Meesho and Pine Labs saw their losses narrowing. Meesho’s net loss dropped 48% to Rs 1,675 crore, while its operating revenue grew 77% to Rs 5,735 crore.

Meanwhile, Pine Labs, which operates in the merchant payments space, reported a total revenue of Rs 1,588 crore in FY23, up 56% from a year ago. Its overall losses dipped marginally to Rs 227 crore, from Rs 259 crore in the previous year.

According to information sourced from Tracxn, Meesho has so far raised over $1 billion, while Pine Labs has raised $1.6 billion.

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