In a major step towards its public listing ambitions, Meesho — the Prosus-backed ecommerce unicorn — has received the green light from the National Company Law Tribunal (NCLT) to relocate its headquarters from Delaware, USA, back to India. The decision not only clears a critical regulatory hurdle but also underscores a growing trend among Indian startups to “reverse flip” and domicile themselves within the country ahead of going public.
Credits: The Economic Times
Redomiciling Back Home: What Happened
As per regulatory filings, the NCLT has approved Meesho’s proposal to demerge its US-based entity, Meesho Inc., and merge it with its Indian counterpart. This effectively completes Meesho’s process of Indian redomiciling — a move that aligns with its broader strategic goal of launching an Initial Public Offering (IPO) on Indian stock exchanges.
The NCLT order stated:
“The objections/observations to the Scheme received from ROC/RD & Income Tax Department have been adequately explained by the Petitioner Companies and hence there is no impediment in approval of the Scheme… The Composite Scheme of Arrangement… is approved and we hereby declare that the same is to be binding on all the shareholders and creditors.”
This approval paves the way for Meesho to now operate solely under its Indian legal entity, strengthening its compliance and credibility in the eyes of domestic investors and regulators.
A $288 Million Price Tag
However, the move is not without cost. According to a report by Moneycontrol, Meesho is expected to pay a staggering $288 million in taxes to the US government as part of the demerger and redomiciling process. This tax outgo, if finalized at the reported figure, would rank among the highest paid by Indian startups shifting their base back to India.
To put that in perspective:
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PhonePe, which moved from Singapore to India in 2022, paid approximately $1 billion in taxes.
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Groww, the stockbroking and investment platform, reportedly shelled out $160 million.
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Razorpay, the payments fintech, is said to have paid around $150 million.
While the tax liability is substantial, the long-term benefits of listing in India — including improved access to Indian capital markets and alignment with local consumer and investor expectations — appear to outweigh the upfront costs for these firms.
Why Are Startups Reverse Flipping?
The move to “reverse flip” — or redomicile back to India — is becoming increasingly common among Indian unicorns. For years, many of them opted to register in foreign jurisdictions like Delaware or Singapore to gain easier access to global capital and investor-friendly legal frameworks.
However, several factors are now driving a reversal:
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Improved regulatory clarity in India around startup IPOs.
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Policy incentives for locally headquartered companies.
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Investors pushing for domestic listings to tap into India’s vibrant retail and institutional capital base.
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National sentiment and strategic alignment with “Make in India” and “Atmanirbhar Bharat” initiatives.
In Meesho’s case, being closer to its core market and users — Tier II and Tier III India — could also help sharpen its focus and create stronger brand resonance ahead of a public listing.
IPO on the Horizon
With the legal and structural work largely complete, all eyes are now on Meesho’s IPO plans. While no official date has been announced, industry insiders suggest the company could file its draft red herring prospectus (DRHP) within the next few quarters.
Founded in 2015 by Vidit Aatrey and Sanjeev Barnwal, Meesho has grown into a formidable ecommerce player by targeting price-conscious, mobile-first consumers in India’s smaller towns and cities. Its asset-light marketplace model and focus on unbranded products have helped it differentiate from giants like Amazon and Flipkart.
Conclusion: A Strong Signal to the Market
Meesho’s reverse flip and NCLT approval mark more than just a corporate restructuring. It sends a strong signal that India is now a preferred destination not only for building startups but also for listing them. As more unicorns weigh similar moves, Meesho’s journey could serve as a roadmap for future IPO aspirants.
