CarTrade shares make a weak debut, list below issue price

CarTrade shares make a weak debut, list below issue price

Shares of CarTrade made a weak stock market debut on Friday by listing at ₹1,599.8 per share on the NSE, a discount to its issue price of ₹1,618 apiece. On BSE, CarTrade shares were trading around ₹1,579, down more than 2% from its IPO issue price.

The initial public offer (IPO) of the online auto classified platform was subscribed 20.29 times on the closing day of the subscription. The three-day issue that closed on August 11, received bids for 26,31,74,823 shares against 1,29,72,552 shares on offer, as per exchanges data. The category for qualified institutional buyers (QIBs) received 35.45 times subscription, while the portion for non-institutional investors was subscribed 41 times. The retail individual investors (RIIs) quota was subscribed 2.75 times.

Rahul Sharma, Co- Founder, Equity99 said, “CarTrade Tech Ltd is a multi-channel auto platform provider company. The company operates various brands such as CarWale, CarTrade, Shriram Automall, BikeWale, CarTradeExchange, Adroit Auto, and AutoBiz. The platform connects new and used automobile customers, vehicle dealers, vehicle OEMs, and other businesses to buy and sell different types of vehicles. The company offers a variety of solutions across automotive transactions for buying, selling, marketing, financing, and other activities.”

The CarTrade platform allows customers to buy and sell used cars as well as new cars. The IPO comprised a pure offer for sale (OFS) of 18.53 million shares by existing shareholders and promoters. The company had raised ₹900 crore from anchor investors ahead of its issue.

The company generates revenues from commission and fees from auctions and re-marketing services, online advertising solutions, lead generation, technology-based services to OEMs, dealers, banks and other financial institutions, and inspection and valuation services. Founded in 2009, CarTrade is backed by marquee investors – Warburg Pincus, Temasek, JPMorgan, and March Capital.

The firm is 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.

Subscribe to Mint Newsletters * Enter a valid email * Thank you for subscribing to our newsletter.

CarTrade IPO Listing Date Today: CarTrade GMP shows moderate listing of shares on NSE, BSE

Follow us on Image Source : CARTRADE.COM CarTrade set to list today on NSE, BSE

CarTrade Tech shares will be listed on the NSE and BSE on Friday (today). CarTrade IPO had earlier received bids for 26,31,74,823 shares against 1,29,72,552 shares on offer. In the category for qualified institutional buyers (QIBs), the company received 35.45 times subscription. The portion for non-institutional investors was subscribed 41 times. The retail individual investors quota was subscribed 2.75 times.

The Rs 2,998.51-crore initial public offer (IPO) of up to 18,532,216 equity shares, was in a price range of Rs 1,585-1,618 per share. The IPO allotment was finalised on August 17 at Rs 1,675 apiece.

The unlisted shares of CarTrade are commanding a moderate premium in the grey market. According to multiple media reports, the shares are trading at a premium of 8 per cent over the issue price, which means that its GMP is around Rs 130-135.

The GMP of CarTrade had once hit Rs 600. But tepid listings of a few IPOs and weak trends in the market have hurt CarTrade’s premium.

Ahead of the public offer, CarTrade Tech had claimed to raise Rs 900 crore from anchor investors.

CarTrade was founded in 2009. It is backed by marquee investors – Warburg Pincus, Temasek, JPMorgan, and March Capital. The CarTrade platform allows customers to buy and sell used cars as well as new cars. The firm is 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.

CarTrade 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.

Latest Business News

CarTrade IPO shares debut at Rs 1,600, a 1.1% discount to issue price

Image: Shutterstock

live bse live

nse live Volume Todays L/H More ×

Multi-channel auto platform CarTrade Tech shares made a weak debut as the stock listed with a 1.11 percent discount to issue price of Rs 1,618 per share. The stock opened at Rs 1,600 on the BSE and Rs 1,599.80 on the National Stock Exchange.

At 10:03 hours IST, it was trading at Rs 1,575.05 on the NSE, down 2.7 percent on the NSE, and was down 2.2 percent at Rs 1,582.45 on the BSE.

Cumulatively, it traded with volume of 36.82 lakh equity shares on the bourses.

The public offer had received healthy response from investors last week as it was oversubscribed by 20.29 times during August 9-11. The portion set aside for qualified institutional buyers was subscribed 35.45 times and that of non-institutional investors saw 41 times subscription. The retail portion was booked 2.75 times.

The company had mopped up Rs 2,998.51 crore through its IPO. It was a complete offer for sale by selling shareholders including JP Morgan’s CMDB II, Highdell Investment, Macritchie Investments, and Springfield Venture International.

CarTrade Tech is a multi-channel auto platform with coverage and presence across vehicle types and value-added services, providing services through platforms under several brands - CarWale, CarTrade, Shriram Automall, BikeWale, CarTrade Exchange, Adroit Auto and AutoBiz.

To Know All IPO Related News, Click Here

Majority of brokerages had recommended to subscribe the issue as it enjoyed the first mover advantage to list in the sector, provides comprehensive range of services, and provides dealer management system to BMW India.

CarWale, CarTrade and BikeWale platforms are used by shoppers to research and connect with dealers, original equipment manufacturers (OEMs), etc, to sell and buy cars and 2-wheeler. 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.

“Considering the future prospect of the company, its scalable business model, profitable operations and business growth opportunities in the auto sector value chain and it is also placed at a sweet spot as the first mover advantage, thus we recommend to ‘subscribe’ the issue,” said BP Equities.

In the financial year ended March 2021, the company earned 57 percent of total revenue 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 contributed around 36 percent to revenues, and the rest of income was received via inspection and valuation services.

Among key competitors, it is the only profitable automotive digital platform since FY19.

BP Equities gave subscribe for long term rating for the issue. “CarTrade actively invests in improving their technology such as their artificial intelligence (AI) and machine learning capabilities in order to provide more relevant and timely information to their customers, and enhance user experience. Its comprehensive range of services i.e. automotive buying, selling, financing, marketing, etc and profitable and scalable business model provide for further growth visibility,” it reasoned.

The views and investment tips expressed by investment expert on Moneycontrol.com are his own and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.