E-commerce platform Meesho has successfully completed its reverse flipping process, moving its domicile from the United States back to India, according to recent reports. This move aligns the company's corporate structure with its primarily India-based operations, marking a significant step for the SoftBank-backed firm as it eyes a potential initial public offering (IPO). Meanwhile, in the fintech sector, PayU India, a subsidiary of Prosus, has reported a 12% increase in revenue for fiscal year 2025, with its payments business achieving breakeven in the second half of the year. However, its credit arm faced losses, highlighting the mixed performance amid a challenging regulatory landscape.
Meesho's reverse flip involved demerging its Indian operations from its US parent entity, a process that has now received the green light from the National Company Law Tribunal (NCLT). With the majority of its business, including customers, sellers, and partners, already based in India, the company stated that this move aligns its corporate structure with its day-to-day operations. As part of the redomiciling, Meesho is expected to pay approximately $288 million in taxes. The company has been firming up its draft IPO papers and is likely to file them in the coming weeks, potentially taking the confidential route. Through the IPO, the e-commerce major is expected to raise around $1 billion at a valuation of $10 billion.
Meesho joins a growing list of Indian startups, including Zepto, Razorpay, and Groww, that have chosen to redomicile to India. This trend is driven by a desire to better align with local norms and tap into India's public markets. Previously, Razorpay paid $150 million, PhonePe paid $1 billion, and Groww paid $157 million in taxes to complete their relocations.
On the other hand, PayU India reported a 12% year-over-year revenue growth, reaching $498 million (₹4,317 crore) in FY25. The company's payment business broke even in the latter half of the year, driven by robust merchant onboarding, increased transaction volumes, and cost optimization efforts. Parent company Prosus also highlighted PayU India's focus on compliance and exiting non-core geographies to align with global strategies. However, PayU Finance, the company's credit division, reported a negative EBIT margin of -19% due to higher credit loss provisions, scaling efforts, and regulatory pressure. Despite these challenges, loan disbursements rose to $1.1 billion, with 23% directed to small and medium-sized businesses.
Looking ahead, PayU aims for full-year breakeven in FY26 for both its payments and lending businesses, with a focus on expanding secure, RBI-compliant credit offerings. In a strategic move to bolster its position in India's payments infrastructure, PayU acquired a 70% stake in Mindgate Solutions for $68 million, a deal expected to enhance its UPI capabilities.
