Motilal Oswal Financial Services initiated coverage on e-commerce platform Meesho with a Buy rating. The brokerage set a price target of Rs 240, representing a potential upside of over 30%.
The positive outlook is based on Meesho’s asset-light business model and minimal capital expenditure requirements. The company operates on negative working capital and generates significant free cash flow.
Meesho currently maintains the largest e-commerce user base in India with a focus on Tier 2+ markets. Motilal Oswal forecasts a 25% compound annual growth rate in net merchandise value between FY26 and FY31.
Improving margins and rising float income are expected to drive profitability by FY27. The firm anticipates substantial free cash flow generation starting in that same fiscal year.