Why Did Meesho Shares Hit 10% Lower Circuit for the Second Day?
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Synopsis
Meesho shares have encountered a significant decline, hitting a 10% lower circuit for two consecutive days. This downturn raises questions about investor behavior amid profit booking, despite impressive gains since its IPO. Explore the dynamics behind this sudden shift in the e-commerce giant's stock performance.
Key Takeaways
- Meesho shares hit a 10% lower circuit for two consecutive days.
- Recent decline attributed to profit booking by investors.
- Shares are still up 82% from the IPO price of Rs 111.
- Meesho's market capitalization is around Rs 91,188 crore.
- The IPO was oversubscribed 79 times, highlighting strong interest.
Mumbai, Dec 22 (NationPress) Shares of Meesho Limited faced intense selling pressure on Monday, leading to a 10% lower circuit hit.
This marks the second consecutive day of decline for the recently listed e-commerce firm.
In the past two trading sessions, Meesho shares have plummeted by nearly 17%, following a 7% drop on Friday.
The recent downturn suggests that some investors might be booking profits after the stock's impressive rally post its market debut.
Meesho shares had more than doubled from the IPO price in just over a week of trading, drawing significant interest.
After Monday's decline, the stock has now decreased by approximately 21% from its post-listing peak of Rs 254.40.
Despite this correction, Meesho shares remain up 82% from the issue price of Rs 111, showcasing substantial gains for early investors.
The company’s market capitalization has now fallen to around Rs 91,188 crore.
Meesho's IPO, which was open for three days and sized at over Rs 5,000 crore, witnessed a remarkable response from investors.
The overall issue was subscribed 79 times. Retail investors exhibited strong interest, subscribing nearly 19 times, while the portion allocated to qualified institutional buyers was subscribed 120 times.
On Monday, Meesho shares were locked at the lower circuit price of Rs 201.68, after reaching an intra-day high of Rs 223.65 earlier in the session.
The stock had a strong market debut, listing at Rs 162, which is a premium of 46% over the IPO price. On its first trading day, shares closed near Rs 170.
In the seven trading sessions following its listing, Meesho shares skyrocketed by nearly 110% from the issue price.
This rapid increase resulted in a short squeeze, as traders who had sold the stock short struggled to deliver shares on schedule.
Consequently, over one crore shares were pushed into the exchange auction mechanism. Such significant price fluctuations are commonly observed in stocks with limited freely available shares.
Point of View
It is essential to recognize the evolving landscape of the stock market, especially in the case of newly listed companies like Meesho Limited. The recent drop in its share price reflects market volatility and investor sentiment, a reminder of the inherent risks in trading. While the initial surge was promising, the current correction serves as a crucial lesson for both seasoned and new investors. NationPress remains committed to providing insightful analysis and updates on market trends.
NationPress
22/12/2025
Frequently Asked Questions
What caused the decline in Meesho's shares?
The decline is primarily attributed to profit booking by investors following a significant rally after its IPO.
How much have Meesho shares fallen recently?
Meesho shares have fallen nearly 17% over the last two trading days.
What was the response to Meesho's IPO?
Meesho's IPO was oversubscribed 79 times, indicating strong investor interest.
What is Meesho's current market capitalization?
Meesho's market capitalization has slipped to around Rs 91,188 crore.
How did Meesho's shares perform post-IPO?
After its IPO, Meesho shares more than doubled from the issue price, showcasing strong initial performance.
