 "Meesho")
Meesho said on Wednesday it has become the first “horizontal” Indian e-commerce company to achieve profitability and generate positive free cash flow – of Rs 232 crore – in FY24.
A horizontal e-marketplace, according to one definition, sells a wide range of products or services of several industries in a digital one-stop shop. Meesho’s revenue from operations grew 33 per cent to Rs 7,615 crore in FY24, helped by a 36 per cent year-over-year growth in orders delivered. Growth was driven by an increase in the annual transacting users as well as higher order frequency of existing customers, said the company.
“This success stems from driving efficiencies across multiple areas like logistics, as well as leveraging Generative AI and Machine Learning for better discovery, improved in-app experience and round-the-clock customer support,” it said in a statement.
Meesho’s selling, general and administrative expenses as a percentage of revenue from operations declined sharply. Adjusted losses, as a result, narrowed by 97 per cent from Rs 1,569 crore to Rs 53 crore, excluding employee share-based compensation expense.
The company had 145 million unique annual transacting users (ATUs) in FY24, implying some 10 per cent of India made a purchase on its platform.
500 million downloads
Meesho held its tag of being the most downloaded shopping app in India by crossing the overall 500 million install mark in FY24. Products for home, kitchen, beauty and personal care, and baby essentials were the fastest-growing categories in FY24.
“We’re also seeing a substantial influx of new-to-e-commerce users, demonstrating our success in acquiring customers from India's underserved markets,” said the company in a statement. “This not only highlights the vast potential for e-commerce in India but also underscores our vital role in making e-commerce accessible to regions that have historically been overlooked.”
Artificial intelligence
Meesho said that by using artificial intelligence (AI) technology to analyse category preferences, demographics and time spent on the platform it delivers a “highly personalised” shopping experience. It ensures that each user gets a homepage tailored for them.
“Our advanced AI model cross-verifies these images with product descriptions, and if there’s a mismatch, the system prevents the generation of a shipping label, leading to 42 per cent seller claim reduction,” said Meesho. “We’ve also seen a remarkable increase in prepaid transactions compared to last year, contributing to lower return-to-origin rates and decreased costs associated with cash-on-delivery orders.”
Customer engagement surged in FY24, with 75 per cent of frequent shoppers contributing ratings and nearly 80 per cent leaving detailed reviews. Customers have contributed to 233 million ratings, 75 million reviews, and 13 million pieces of user-generated content such as images and videos.
A summary of Meesho’s key financial metrics for FY 2023-24 are as follows:
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