CarTrade Tech IPO is getting launched for subscription on Wednesday 09, August 2021, and will be available for subscription till Friday, 011 August, 2021.
The company is looking to raise Rs.3000 crore through public issue with 1,85,32,216 equity shares in a complete offer for sale (OFS) by existing selling shareholders and the company will not receive any proceeds from the issue.
The CarTrade is seeking a market valuation of Rs.7,400 crore at the upper end of its price band.
The equity shares of CarTrade Tech Limited are proposed to be listed on both BSE and NSE.
The CarTrade Tech IPO issue will be sold in the price band of Rs 1585-1618 per share and the minimum lot quantity is 9 shares and in multiples thereof translating to a minimum investment of Rs 14,562 at upper end.
The latest Grey market premium price (GMP) for CarTrade Tech IPO were seen up by more than 35.79% and were trading around Rs.556-583 as of today, This means people are expecting it to open on listing day to be at least at Rs.2100-2150 or more.
Having said that GMP does not mean in anyway a recommendation for an IPO, the financials of a company and its future prospectus tells a lot.
Here is the thing no one can tell you whether the IPO will going to make a stellar debut or not, it is you who have to decide based on available information about the company.
Moreover the IPO’s now a days are very hot market every one wants to earn some quick money on listing day itself and there is nothing wrong about it.
One must not forget to check the financials and do not fall for any recommendation from anyone, it is you hard earned money, you should decide whether to opt for the IPO or not.
You may have watch various YouTube channels or read on different websites about recommendation for stocks and IPO, it is my humble suggestion and request please do not ever fall prey to it. Better than this is to invest in ETF’s?.
Therefore, whenever you are buying IPO make sure the money invested is not the one which you my need it urgently, always use extra money which you may not require in near future, Otherwise stay away completely.
Now, coming back to the CarTrade Tech IPO let us talk about in brief about the company and its financials and other details step by step.
About CarTrade Tech Limited (CTT):
CTT is a multi-channel auto platform with a presence across varied vehicle types and value-added services. Through its platforms operated under the brand names of CarWale, CarTrade, Shriram Automall, BikeWale, CarTradeExchange, Adroit Auto and AutoBiz.
The company serves as an integrated online and offline marketplace for vehicle owners, dealerships, OEMs and other businesses. Its services span the gamut of automotive transaction value chain, i.e. marketing, buying, selling and financing of new and preowned cars, 2-W, CV and other vehicles.
CarWale, CarTrade and BikeWale platforms are used by shoppers to research and connect with dealers, OEMs, etc, to sell and buy cars and 2- Ws. Shriram Automall (a subsidiary) facilitates sale of pre-owned vehicles.
CarTrade Exchange is an online auction platform and a used vehicle ERP tool, also used by dealers to manage their processes like procurement, inventory management and CRM. Adroit Auto offers vehicle inspection and valuation services while AutoBiz provides CRM solutions to new car dealers.
The company is led by Vinay Vinod Sanghi (MD & CEO, 30 years of automotive experience) and has marquee institutional shareholders such as Highdell Investment (affiliate of Warburg Pincus), MacRitchie Investments (affiliate of Temasek), JP Morgan and March Capital.
As of FY21, CTT had 2.6 crore monthly average unique visitors on its websites/apps (of which 88.4% were organic i.e. from unpaid sources) and featured 8.14 lakh listings on its online and offline auction platforms.
Its websites and apps handled 21.5 lakh and 17.6 lakh user sessions per day in Q4FY21 and Q1FY22, respectively.
CarTrade Tech Limited Financials:
As of FY21, 57% of CTT’s revenue was derived from commission and fees for auction, remarketing services of used vehicles.
Online advertising solutions on its portals along with lead generation for OEMs, dealers, etc., and technology-based services combined accounted for 36% of revenues while 7% was obtained via inspection and valuation services.
CTT was the only profitable automotive digital platform among its key peer set as of FY20. On the b/s front, it is a net cash positive company with surplus cash amounting to Rs.650 crore as of FY21.
The company Net sales grew at a CAGR of 1.3% (FY19-21), EBITDA growth is seen at 15.5% and Net Profit (Adjusted for deferral tax credit)at 32.4% for the same period, respectively.
Priced at 30x MCap/sales (FY21) on upper price band, CTT offers a unique play on rising digitisation of new and pre-owned vehicle transaction value chain/ecosystem.
Seeing the prevailing preference for digital platforms including the recent listings, one may subscribe to the issue for listing gains. This is a opinion and not recommendation at all.
Long term wealth generation at CTT will depend on scalability, relevance and journey towards healthier return ratios in future.
CarTrade Tech Limited Peers Comparison:
Although there are no other listed pairs to make comparison for CarTrade, some key players in the space include Cars24, CarsDekho, Mahindra First Choice Wheels and Droom among others.
As of FY20, CTT was the only profitable player in this peer set. CarWale and BikeWale were ranked No. 1 in relative online search popularitycompared to peers during FY21 while as of FY20.
Shriram Automall was a leading used vehicle auction platform based on number of vehicles sold.
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CarTrade Tech IPO Details:
CarTrade Tech Limited will sell shares at Rs 1585-1618 per share in its 3 day initial public offering starting on August 9 to 11, 2021.
The shares of CarTrade Tech IPO will be allotted on 17 August, 2021, The tentative date of CarTrade Tech IPO listing is around 23 August, 2021.
CarTrade Tech Objects of the Offer:
This is the pure offer for sale (OFS) with company receiving no proceeds from IPO. The company wants to accrue the benefits of listing Equity shares on stock exchanges.
CTT has no promoters. It’s existing investors are offloading their 40.4% stake.
Frequently Asked Question (FAQ):
1.What Is The Symbol For CarTrade Tech Limited ?
Ans: The Symbol is CARTRADE
2.When CarTrade Tech IPO Coming?
Ans: The Issue Period for CarTrade Tech IPO is 9-Aug-2021 to 11-Aug-2021.
3. Post Modification Period For CarTrade Tech IPO?
Ans: The Post issue Modification Period for IPO is 12-Aug-2021 (10.00 A.M. to 11.00 A.M.).
4. What Is The Cut-off Time Period For UPI Mandate For CarTrade Tech IPO?
Ans: The Cut-off time for UPI Mandate Confirmation is 12-Aug-2021 (upto 12:00 PM).
5. What Is The Issue Type For CarTrade Tech IPO?
Ans: The Issue Type is 100% Book Building.
6.What Is The Price Band For CarTrade Tech IPO?
Ans: The Price (Band) Range for CarTrade Tech is Rs.1585 to Rs.1618 per equity share.
7. What Is The Lot Size For CarTrade Tech IPO?
Ans: The Bid Lot i.e. Minimum Order Quantity (lot size) for CarTrade Tech IPO is of 9 Equity Shares and in multiples thereof 9 Equity Shares.
8. Who Are The Book Running Lead Managers For CarTrade Tech IPO?
Ans: The Book Running Lead Managers are, Axis Capital Limited, Citigroup Global Markets India Private Limited, Kotak Mahindra Capital Company Limited and Nomura Financial Advisory and Securities (India) Private Limited
9. What Is The Face Value For CarTrade Tech IPO?
Ans: The Face Value is of Rs.10 whereas The Tick Size is of Rs.1
10. What Is The IPO Market Timings For CarTrade Tech IPO?
Ans: The IPO Market Timings is 10.00 a.m. to 5.00 p.m.
Apart from above points:
The Maximum Subscription Amount for Retail Investor is Rs. 2,00,000
The Name of the Registrar is Link Intime India Private Limited
The Contact person name number and Email id is Shanti Gopalkrishnan,+91 22 4918 6200, cartrade.ipo@linkintime.co.in
The Address of the Registrar is C-101, 1st Floor 247 Park Lal Bhadur Shastri Marg Vikhroli (West) Mumbai 400 083 Maharashtra, India
Where To Check CarTrade Tech IPO Application And Allotment Status?
As an investor or trader generally we are curious and anxious to know the results of the application as soon as possible. To ease the anxiety, both Bombay Stock Exchange (BSE) and National Stock Exchange (NSE) have come up with dedicated pages and links which investors can use.
NSE
The NSE has an IPO bid verification module. It can be used to verify the IPO application details uploaded on the exchange bidding system by your member/bank. The data of the bid details uploaded by the member/bank would be available on T+1 day (where T would be date receipt of bid on NSE platform).
In addition, the data would be available until six days after the issue closure date. This gives the investor enough time to verify the data and instruct the member/bank to make any changes, if required.
Exchange will also provide allotment information as provided by the registrar to the issue.
An investor can avail this facility by registering using his/her PAN details. After registration, the investor will receive an email notification from NSE on the registered email address. That email will provide the login details.
The following link can be used for the same:
https://www.nseindia.com/products/dynaContent/equities/ipos/ipo_login.jsp
BSE
The BSE has also come up with a similar platform.
This unique facility allows investors to verify the status of their application submitted to a Trading Member or a SCSB (Self-Certified Schedule Banks).
The investor can check his application status/information on the website until one week after issue close.
The following link can be used by investors:
https://www.bseindia.com/investors/appli_check.aspx
Important Things To Keep In Mind Before Applying For IPO’s:
- Try to fill for the same IPO online from different DP ID i.e. if in your family have more than 1 account you can possibly get the allocation done in case of over subscription.
- You should have a good knowledge of the sector and the company you are planning to invest.
- Analysis of the company’s balance sheet is very crucial. A clear understanding of the company’s future projects and vision is very necessary to know whether it will have a sustainable future.
- Investment decision has to be taken carefully and not in a hurry.
- Read as much as you can about the company, its objectives for launching the IPO, its past history in business and its futures prospectus.
- Don’t go for hype in the news, your analysis should be based on facts rather than gossips and rumors.
- Many IPOs are oversubscribed. What this means is that the demand for shares is much higher than the shares available for sale. In such a situation, it is no surprise that many investors fail to get any shares allotted to them. This is why it is advisable to apply for IPO shares on the last day of bidding. This way, one can have a good estimate on how large the subscription will be. Also, in that case, one should bid for just one lot and not unnecessarily lock up their capital.
Conclusion:
As of FY20, total addressable market (TAM) for Indian automotive portals was estimated at US$14.3 billion (1.06 lakh crore), of which CTT and key competitors combined covered only <5%.
With >90% Indian customers estimated to be using online channels for research before buying a new or used car, the space is well poised for market share gains by organised players (particularly ones with end-to-end presence) at the expense of current unorganised, fragmented industry segments.
The used car market is large (consisting of 30,000 dealers; 85 lakh transactions in FY20) but highly (90%) unorganised and fragmented.
Total 50% dealers face issues in lead conversion, vehicle unavailability and low volumes. Increasingly, dealers are using online platforms to source or sell used cars.
Among used car buyers and sellers as well, online channels enjoy higher net promoter scores than local offline dealers due to wide choices, price delivery and convenience.
Let us checkout some of the strengths and risk factors for CarTrade Tech
Some of the qualitative factors and strengths of CarTrade Tech
- Strong brand suite serving US$14.3 billion addressable market
- Differentiated, profitable business model
- Healthy outlook for Indian auto sector
- Margins, return ratios to benefit from operating leverage
Some of the Risk Factor for CarTrade Tech
- Investment by OEMs and/or dealers in their own digital platforms
- Technology upgradation, safety/security lapses of platforms/data
- Muted capital efficiency due to goodwill on b/s (50% of networth)
Therefore, it is always advisable to go through CarTrade Tech IPO – RHP to know in detail about the company.
The only thing which should be bothering you is the research you did before applying for the IPO. Investing in IPO is risky as well as profitable.
Having said that you also need to keep in mind important things mentioned above before applying to IPO’s as the risk is always involved.
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All investments are subject to risks, which should be considered prior to making any investments. The above details are compiled from information available on public platforms. These are not buy or sell recommendations.
