Quikr raises ₹55 cr debt from In­noven to grow op­er­a­tions

Mint ST - - DEALS - [email protected] NEW DELHI

Firm to use funds to scale trans­ac­tion busi­ness across ver­ti­cals

Quikr In­dia Pvt. Ltd, which runs an on­line clas­si­fieds and ser­vices por­tal, has raised ₹55 crore in debt fi­nanc­ing from Te­masek-owned In­noven Cap­i­tal to grow its op­er­a­tions.

It fol­lows the 2016 rais­ing of ₹130 crore by Quikr in ven­ture debt from Brand Cap­i­tal, the pri­vate treaty arm of me­dia con­glom­er­ate Ben­nett, Cole­man and Co. Ltd (BCCL).

“As a busi­ness, we con­tin­u­ously look to op­ti­mise our cap­i­tal struc­ture and saw a very good fit in ven­ture debt to sup­port growth of our trans­ac­tion busi­nesses,” said Pranay Chulet, Quikr’s chief ex­ec­u­tive, in a state­ment on Fri­day.

Quikr has also raised over $350 mil­lion so far in eq­uity fund­ing from War­burg Pin­cus, Ma­trix Part­ners, Nor­west Ven­ture Part­ners, ebay, Nokia Growth Part­ners and AB Kin­nevik among oth­ers. It is in talks to raise be­tween $100-$150 mil­lion from new and ex­ist­ing in­vestors by keep­ing its record val­u­a­tion of $1 bil­lion, Mint re­ported in Septem­ber.

Quikr faces tough com­pe­ti­tion from Olx, owned by South African me­dia and e-com­merce com­pany Naspers.

Swedish in­vestor, AB Kin­nevik, which holds an 18% stake in Quikr, had cut the fair val­u­a­tion of its hold­ing in Quikr by 12% as of De­cem­ber 2017, re­duc­ing the com­pany’s over­all val­u­a­tion to $935 mil­lion. The in­vestor how­ever marked up its hold­ing by 16% to about $178 mil­lion in the pe­riod ended 30 June 2018, im­ply­ing a to­tal val­u­a­tion of about $1.03 bil­lion for Quikr.

Tiger Global-backed Quikr op­er­ates in seg­ments such as real es­tate, auto, jobs, goods and ser­vices.

Real es­tate is among the high­est rev­enue gen­er­at­ing seg­ments across its five ver­ti­cals, Chulet said in a tele­phone in­ter­view last year.

The var­i­ous busi­nesses of Quikr have recorded ro­bust growth for the year through March 2018.

Real es­tate seg­ment surged 105%, used cars and bikes 115%, goods 90%, Quikr­jobs 90% and Quikreasy 80%. The com­pany also plans to ex­pand its fi­nan­cial ser­vices busi­ness, the most re­cent of its busi­nesses, Chulet had said. Quikr cut its losses by 28% to ₹231.2 crore in the last fis­cal year. Rev­enue climbed 52% to ₹199.98 crore.

Quikr had been on an ac­qui­si­tion spree since 2015 and has ac­quired 13 com­pa­nies so far across cat­e­gories. These con­trib­ute nearly 55% of Quikr’s to­tal rev­enue, said Chulet.

The com­pany had sought to grow through ac­qui­si­tions and cre­ate a di­verse range of busi­nesses.

It is also aim­ing to dou­ble rev­enue in this fis­cal year to ₹350 crore.

“The com­pany has show­cased strong mo­men­tum, with im­prov­ing unit eco­nomics and is po­si­tioned well to har­ness the ben­e­fits of scale and large cus­tomer base,” said Aashish Sharma, chief ex­ec­u­tive of In­noven Cap­i­tal.

Sev­eral start-ups are opt­ing for ven­ture debt cap­i­tal as against tra­di­tional eq­uity fund­ing. In­noven Cap­i­tal, one of the big­gest ven­ture debt firms in In­dia, has closed more than 40 deals dur­ing the year, said Sharma by tele­phone.

Mum­bai-based In­noven counts uni­corn firms in­clud­ing Oyo Rooms (Oravel Stays Pvt. Ltd), Swiggy (Bun­dle Tech­nolo­gies Pvt. Ltd.) and Byjus (Think and Learn Pvt. Ltd) among oth­ers as its port­fo­lio com­pa­nies. In­noven has seen 25-30% an­nual growth rate in in­vest­ments this year, Sharma added.

Quikr’s ac­qui­si­tions how­ever have not worked out as well as the com­pany had ex­pected. Like many other on­line busi­nesses, Quikr strug­gled to trans­late traf­fic on the plat­form and fo­cussed on cut­ting costs and ex­pand­ing busi­nesses that are los­ing less money. Chulet had ear­lier claimed that the cash burn has re­duced by 40-50% over time.

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