CarTrade, the online market platform for buying and selling automobiles, has decided to go public. The firm has recently made its filing for an upcoming Initial Public Offering (IPO), by submitting its Draft Red Herring Prospectus (DRHP) with the Securities and Exchange Board of India.
The company, through its IPO, is planning to make an Offer for Sale (OFS) for as many as 1,23,54,811 equity shares. The DRHP was released by Axis Capital, which has been announced as the lead book running manager for the issuance of the equity shares. Other investment banks to be signed up include Kotak Mahindra Capital Co., Nomura, and Citigroup Capital Markets.
CarTrade has been a relevant name in the car trading market for a lot of years now, and has managed to tough it out in a highly competitive market. The IPO will help the company reach new goals, especially at a time where expansion in the vehicles market has been curbed by the COVID 19 pandemic.
Through the move, CarTrade hopes to raise around ₹ 2,000 Crore (or ₹ 20 Billion). The details for the price band of the equity shares has been revealed by Axis Capital, with the shares having a face value of ₹ 10 apiece.
As per its DRHP filing ahead of its IPO, the platform admits to having reported revenues in excess of ₹ 318 Crore, on a consolidated level. These included a net profit of ₹ 31.2 Crore. As for the Fiscal Year 2021 of 9 months (FY21), the company had, in December last year, reported an income of ₹ 189.6 Crore, with a net profit of ₹ 85 Crore.
As CarTrade goes public, a number of current shareholders will be offloading (or letting go) of their stocks. Notable names among these include Temasek, Warburg Pincus, March Capital/Springfield Venture International (who will be selling 11,24,700 shares), and JP Morgan (who will be offloading 16,08,324 equity shares). Temasek/MacRitchie Investments, and Warburg Pincus/Highdell Investments will each be selling 35,68,217 shares. Bina Vinod Sanghi, one of the company’s promoters, will also be offloading 1,83,333 shares. The total number of shares which are slated to be offloaded will constitute around 27% of the post-offer paid-up equity share capital of the company.
Since its inception in 2009 by the hands of Vinay Sanghi himself, the platform has continued to grow, now reaching to more than 80 cities in the country, and, as of last year, selling around 1 million vehicles annually.
CarTrade has had an impressive run in the Indian market, coming very close to reaching the Unicorn mark (which lies at a value of $1 Billion), during the recent ₹ 2.5 Crore fundraise.