Meesho faces $14.4m legal dispute with AWS before IPO
- ByStartupStory | October 28, 2025
E-commerce unicorn Meesho is embroiled in a significant legal dispute with Amazon Web Services (AWS) India over alleged non-payment of cloud service dues amounting to ₹127.45 crore (approximately $14.4 million). The issue has surfaced just weeks before Meesho plans to debut on public markets with a major Initial Public Offering (IPO) aimed to raise around ₹4,250 crore.
The Dispute Overview
AWS initiated arbitration proceedings against Meesho before a three-member tribunal in New Delhi under the Arbitration and Conciliation Act, 1996. The cloud giant claims Meesho has failed to meet contractual payment commitments dating back to February 2022, particularly relating to a Private Pricing Addendum (PPA). AWS is demanding overdue payments covering the shortfall, pending service fees, accrued interest, and arbitration costs.
In response, Meesho has strongly contested the claims. The company alleges that AWS failed to deliver services as contracted, resulting in operational disruptions. Meesho has filed a counterclaim seeking ₹86.49 crore (approximately $9.7 million) in damages, citing losses due to inadequate support and costs incurred while migrating workloads to alternative cloud service providers.
Implications for Meesho Ahead of IPO
This litigation cloud hangs heavily on Meesho, which is positioning itself as India’s first pure-play horizontal e-commerce marketplace to go public. The company has incorporated disclosures of this dispute in its Draft Red Herring Prospectus (DRHP) filed with SEBI.
Meesho plans to channel about ₹1,390 crore from the IPO proceeds into strengthening its cloud infrastructure over the next three years, underscoring the criticality of cloud technology to its business operations.
Market Response and Industry Context
AWS dominates the global cloud infrastructure market with nearly 30% market share as of mid-2025, making it a key technology partner for ecommerce and digital startups worldwide. The intensifying dependency on cloud platforms has increased sensitivity around service agreements, costs, and performance standards.
Investors will be closely monitoring the resolution of the AWS-Meesho arbitration as it could influence company valuation, operational stability, and investor confidence during the IPO subscription period.
Broader Vendor and Tax Disputes
Apart from the AWS arbitration, Meesho faces other vendor and tax-related disputes totaling over ₹700 crore, including income tax, GST, and landowner disputes. These legal and financial challenges highlight the complex regulatory landscape India’s burgeoning startups navigate.
Looking Ahead
The pending arbitration remains unresolved, with AWS having filed its reply in March 2025. A resolution could take several more months, potentially coinciding with Meesho’s IPO timeline.
Despite the dispute, Meesho continues to command investor interest due to its strong market position, growth metrics, and innovative value-commerce model, which differentiates it from conventional e-commerce marketplaces.
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