CarTrade Plans to List on Bourses

The Economic Times - - Companies: Pursuit Of Profit - Sharmistha.Mukher­jee @times­group.com

New Delhi: On­line auto classifieds plat­form CarTrade, which had ear­lier this year raised $145 mil­lion (.`960 crore) from Te­masek Hold­ings, March Cap­i­tal and War­burg Pin­cus, is plan­ning to list on the bourses in the next three years, its founder said.

“We are oper­a­tionally prof­itable and are tar­get­ing in­creas­ing rev­enue by 2.5 times this year,” said Vi­nay Sanghi, who is also its chief ex­ec­u­tive. He didn’t say how much was its rev­enue last year.

CarTrade claims to sell around 25,000 new cars and 30,000-40,000 pre-owned cars on its plat­form ev­ery month. The com­pany has three streams of rev­enue: sub­scrip­tion fees from used-car and new-car deal­ers reg­is­tered on the plat­form, from ad­ver­tise­ments of au­to­mo­bile com­pa­nies and fees ap­plied on ve­hi­cle auc­tions con­ducted on the site.

“There is a strong po­ten­tial to grow in the used-car busi­ness to be­gin with, as the pre-owned ve­hi­cle mar­ket is mostly un­or­gan­ised,” said Ab­dul Ma­jeed, part­ner, Price Water­house, a net­work firm of Price­wa­ter­house­Coop­ers in In­dia. “Many au­to­mo­bile com­pa­nies have en­tered the space. The key to be suc­cess­ful is to gain cus­tomer con­fi­dence. The new car mar­ket on­line is evolv­ing and yet to come of age in In­dia.”

CarTrade, which has part­nered with over 10,000 new- and used-car deal­ers, lists over 225,000 used cars for sale and auc­tions over 250,000 ve­hi­cles to the whole­sale mar­ket ev­ery year. It regis­ters around 35 mil­lion unique vis­i­tors across its plat­forms ev­ery month.

The com­pany is look­ing at ex­pand­ing its prod­uct of­fer­ings and is in talks with mul­ti­ple banks to in­tro­duce fi­nanc­ing op­tions by June for prod­ucts sold on its plat­form. “The pre-owned car mar­ket, which is now sized at around 4 mil­lion units, is grow­ing at the rate of 12-15% … How­ever, auto fi­nance pen­e­tra­tion in the used-car mar­ket is only about 10%,” said Sanghi. “We be­lieve we can or­gan­ise this mar­ket. There is a lot of po­ten­tial to grow.”

CarTrade, which ac­quired CarWale when Ger­man me­dia con­glom­er­ate Axel Springer ex­ited the com­pany in Novem­ber 2015, said it has con­cluded six rounds of fund­ing since in­cep­tion and does not re­quire fresh re­sources in the near fu­ture. In­vestors also in­clude Canaan Part­ners, Epiphany Over­seas Ven­tures and Tiger Global.

CarTrade com­petes with pri­vate equity and ven­ture cap­i­tal-backed firms like Jaipur-based Cardekho.com (Girnar Soft­ware So­lu­tions), Droom Tech­nol­ogy and True­bil (Paix Tech­nol­ogy).

Co claims to sell 25k new cars and 30k-40k pre-owned cars ev­ery month

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