CarTrade Tech IPO opens for subscription: Key things to know

NEW DELHI: Online auto classified platform CarTrade Tech’s initial public offering (IPO) is now open for subscription. The company has fixed a price band of Rs 1,585-1,618 per share for its nearly Rs 2,999-crore initial offer.
The initial share sale will be entirely an offer for sale (OFS) of 18,532,216 equity shares. The IPO will conclude on August 11.
At the upper end of the price band, the IPO is expected to mobilise Rs 2,998.51 crore.
Here are the key things to know about the CarTrade IPO:
*CarTrade is also a software company that has created interconnects between stakeholders like dealers, manufacturers, and banks.
* The company cited an industry report to highlight that there is a constant move towards online auto portals and the total addressable market in India was estimated at $14.3 billion in FY 2020.
* CarTrade is also among the largest automotive data destinations in the country.
* The company expects that listing of the equity shares will enhance its visibility and brand image and provide liquidity to its shareholders, while also providing a public market for the equity shares in India, as per CarTrade’s Red Herring Prospectus.
* Founded in 2009, CarTrade is backed by marquee investors — Warburg Pincus, Temasek, JP Morgan, and March Capital. The CarTrade platform allows customers to buy and sell used cars as well as new cars. The company stated that it is a professionally managed entity and does not have an identifiable promoter (in terms of Sebi rules).
* As a part of the OFS, CMDB II will offload 22.64 lakh equity shares, Highdell Investment Ltd will sell 84.09 lakh equity shares, Macritchie Investments Pte Ltd will offer 50.76 lakh equity shares and Springfield Venture International will divest 17.65 lakh equity shares.
* The company will not directly receive any proceeds from the offer and all the proceeds will be received by the selling shareholders, in proportion to the offered shares sold by the respective selling shareholders as part of the offer.
* Currently, CMDB II holds 11.93 per cent stake in CarTrade43, Highdell Investment owns 34.44 per cent stake, MacRitche Investment has 26.48 per cent shareholding and Springfield Venture International holds 7.09 per cent stake in the company.
* CarTrade offers a multi-channel auto platform with coverage and presence across vehicle types and value-added services through its brands — CarWale, CarTrade, Shriram Automall, BikeWale, CarTradeExchange, Adroit Auto and AutoBiz.
* Its consumer platforms – CarWale, CarTrade, and BikeWale – collectively get 3.2 crore, average unique visitors, every month (during the 3 months period ending March 31, 2021), and Shriram Automall and other auction platforms had 8,14,316 vehicles listed for auction during the financial year 2020-21.
* The company generates revenues from commission and fees from auctions and remarketing services, online advertising solutions, lead generation, technology-based services to original equipment manufacturers, dealers, banks, and other financial institutions, and inspection and valuation services.
* Half of the OFS issue size has been reserved for qualified institutional buyers (QIBs), 35 per cent for retail investors, and the remaining 15 per cent for non-institutional investors.
* Axis Capital, Citigroup Global Markets India, Kotak Mahindra Capital Company, and Nomura Financial Advisory and Securities (India) Private Limited are the investment bankers to the issue.
(With inputs from agencies)

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