Business Standard

‘Shut OLX Auto due to focus on profitable growth’

- ANEESHA MENON Executive director & CFO, Cartrade

After buying OLX India last year, the country’s leading auto portal Cartrade aims to continue its trend of profitable growth of 20 to 30 per cent in the coming quarters, Executive Director and Chief Financial Officer ANEESHA MENON tells Anjali Singh in a video interview. Edited excerpts: How does Cartrade plan to maintain its market leadership in the auto portal space?

We have a leadership position in key segments such as consumer auto portals, used-car classified­s, and vehicle auctions. Our dominance in the consumer group is unparallel­ed, especially in the auto portal segment. We have strong brand recall value as we have acquired several brands over the past 8 years, such as Carwale, and Bikewale, with the most recent one being OLX, which was completed last year. The acquisitio­n of OLX has helped us add around 30 million monthly active users (MAUS), taking the total MAUS to 70 million.

Can you provide the estimated growth in the next few quarters?

While we never disclose our figures publicly, our historical growth has been in the range of 20 to 30 per cent, a trend we aim to continue. Our focus remains on profitable growth and our recent performanc­e, including a 48 per cent revenue growth in December, resulting in a profit after tax of nearly ~22 crore for the continuing operations.

How much revenue do the acquired entities contribute? How did profitabil­ity compare before and after the acquisitio­ns?

The acquisitio­n of OLX resulted in a 45 per cent increase in Cartrade’s overall revenue for the third quarter. Currently, each of Cartrade’s three business segments (Cartrade, Shriram Automall, and OLX) contribute roughly equally to total revenue, with OLX contributi­ng approximat­ely 31 per cent. Prior to the acquisitio­n, Cartrade’s quarterly profitabil­ity was ~19 crore. The OLX acquisitio­n added ~10.47 crore, bringing the total segmental profit to ~29.78 crore, marking a

54 per cent increase.

Why did you shut down your OLX business?

We acquired OLX India, a major classified­s platform in the country, in 2023. We were particular­ly interested in the OLX.IN brand. However, the deal also included OLX Autos, a used car buying and selling business that was losing money. Due to our focus on profitable growth, we decided to shut down OLX Autos after a quick analysis. We found that the unit economics, meaning the cost to acquire a customer, were broken and couldn’t be fixed easily. Additional­ly, the high competitio­n in the used car market made it a race to the bottom.

 ?? ??

Newspapers in English

Newspapers from India