Cartrade IPO : A Detailed Guide

CarTrade  IPO details
Issue Period	9-Aug-2021 to 11-Aug-2021
Price Range	Rs.1585 to Rs.1618
Bid Lot	9 Equity Shares and in multiples thereof
Minimum Order Quantity	9 Equity Shares
Maximum Order Quantity	117 Equity Shares
Maximum Subscription Amount for Retail Investor	Rs. 2,00,000
IPO Market Timings	10.00 a.m. to 5.00 p.m.
Allotment Date	17-Aug-2021
IPO listing Date	23-Aug-2021

With over a decade of experience in the automobile industry, CarTrade has become one of the leading sources of information about new and used cars in India. Through its online and regional operations spread across India, it has facilitated the easy sale and purchase of both new and old cars by consumers.

Now, to further meet its corporate objectives and repay its outstanding liabilities, CarTrade Tech Ltd is getting ready to announce its Initial Public Offering (IPO). It has already submitted its draft red herring prospectus to India’s Securities and Exchange Board (SEBI) on May 15, 2021.

When one of the significant online auto commerce companies decides to go public, it becomes the focus for the investors. Here is all the information you need to know about the CarTrade IPO launch date, the CarTrade IPO price, CarTrade expected share price, and how to apply for the CarTrade IPO.

About the CarTrade company

The online classifieds platform, CarTrade was started in 2010 as a startup by its founders, Mr Vinay Sanghi and Mr Rajan Mehra. CarTrade is headquartered in Mumbai and operates both the business-to-business and business-to-consumer platforms. With over 4,000 dealers spread across India and a reach of over 4 million consumers in major cities, CarTrade has made an impressive mark in the market. 

Some of the key decisions that played a crucial role in the unicorn status enjoyed by the company are:

• First and foremost, let’s talk about the major acquisitions which played a vital role in bringing CarTrade to the top of the leaderboard in the online marketplace for automobiles.

Year	Acquisitions
2015	Carwale for $90million cash -Post this, the revenue of CarTrade grew from Rs34 crores to Rs88 crores in 4 years
2017	Adroit Inspection( A vehicle valuation and inspection venture) for all cash
2018	51% interest in Shriram Automall of Shriram Group

• The CarTrade company believes in working on the asset-light business model. This helps them reduce their capital expenditure and use the balance cash for acquisitions, like CarWale and Adroit Inspection. Both these acquisitions have not only increased revenue but also productivity of CarTrade.
• The above point can be proved through how Cartrade used the Carwale platform to generate SEO leads to its sites and, in turn, managed to cut its cost in marketing, advertisement. The result was that over 88% of consumers visited the site in FY 2021.
• With these significant investments in building and up-gradation of technology, they have managed to scale their services and simultaneously reduce their fixed costs. The result of this can be seen in their consistently increasing margins and profitability.
•  In the financial year (FY) 2020, their profit before tax was 14.52% compared to 12.22% in 2019. Also, Its capital asset gearing ratio (CAGR) has seen an increase of 45.49% from FY 2018 to 2020.
• CarTrade also scaled its operations in the bike demographic through its online platform “Bikewale”. Compared to the competitors, both Bikewale and Carwale lead the online search popularity index.

Recently, the IIFL and Malabar Investment Group also joined the list of CarTrade financial investors. CarTrade now has the support of nine sound investors. With the strong backing and strong financials, the company is now ready to enter into the IPO to achieve its future goals.

All About the CarTrade Tech IPO

When a private company, be it old or new, goes public or decides to be listed on a stock exchange, that process is called IPO. 

CarTrade has recently created a buzz in the automobile market by submitting its draft red herring prospectus to the regulator, SEBI, for its IPO. 

• This IPO will put the company on the market with the likes of Zomato, PolicyBazaar, and other technology-based companies.

• The company plans to raise approximately Rs. 2,000 crore through this offer and the IPO will be listed on both the Bombay Stock Exchange (BSE) and National Stock Exchange (NSE).
• The company’s promoters plan to make an offer for sale (OFS) for 12,354,811 equity shares with a face value of Rs. 10 each. There is no fresh equity of shares, only an OFS in the issue.
• The company is expected to not receive any amount from such an offer, and all the proceeds will go to the investors selling their holdings.
• Highdell Investments and MacRitchie Investments are the company’s principal shareholders holding approximately 60.90% of the company. Post this offer, they are expected to offload 5.3 million and 3.5 million equity shares, respectively. 

Overall, around 12 shareholders, including the founder, Mr. Vinay Sanghi, will be offloading a percentage of their holdings.

Now, let’s talk about which companies are getting involved in the IPO. 

Company	Title in IPO
Link Intime India	Registrar(Allotment of shares)
Axis Capital	Management of the issue
Kotak Mahindra Bank	Management of the issue
Citigroup Global Markets, India	Management of the issue
Nomura Financial Advisory and Securities(India)	Management of the issue

The IPO draft includes the following allotment schedule :

Buyers	Allotment percentage
Qualified Institutional Buyers (QIBs)	75%
Non-institutional Investors	15%
Retail buyers	10% (with minimum lot of 1)

With the launch of the CarTrade IPO, the company plans to provide efficient platforms for brands, make sustainable business strategies, build integrated technology systems, and eventually be a leader in the auto segment.

CarTrade Tech IPO Launch Date

The CarTrade tech IPO opening and closing date are both currently unavailable. The exact launch date has not been specified yet.

However, the CarTrade IPO is expected to be launched and closed in FY 2021.

CarTrade Tech IPO Price

The band price for the CarTrade IPO is not available yet. However, the CarTrade IPO price is expected to be released soon. As per the details available, the face value will be Rs. 10 per share. The initial amount set in the draft prospectus to SEBI is to raise Rs. 2,000 crores via the OFS. The size of the CarTrade IPO offer is expected to be approximately $250–275 million. This will bring the CarTrade IPO’s expected share price to approximately Rs. 1,600 per share.

How to Apply for the CarTrade IPO with TradeSmart

With the IPO creating a major buzz in the market, no investor would want to miss the chance of applying for the same. Every interested investor should go through CarTrade’s prospectus available on the SEBI website to understand the company’s corporate objectives and goals.

Now, to invest in an IPO, you need funds, for which you may use your savings or take a loan at reasonable interest rates. Nowadays, many banks and financial institutions provide loan facilities with flexible repayment schedules.

Once you have read the prospectus and arranged the funds, you need to open a Demat account with a reputed company like TradeSmart. 

The Demat-cum-trading account is a storage account for your online investment in stocks and securities. You only need to provide identity proofs such as Aadhar and PAN cards, in addition to address proofs, to open the same.

The following steps will help you understand how to be a part of this IPO with TradeSmart. You can easily access the IPO through the TradeSmart platform by linking any of the supported UPI apps.

Step 1: First, the user needs to log into the “Box” and go to the “Portfolio menu.”

Step 2: Select the “CarTrade Tech IPO” from the list of various IPO options under the portfolio menu.

Step 3: Now, click on the “Bid” option to participate in the offer. 

Step 4: After this, you need to enter your UPI ID. Ensure that the UPI ID you have entered is registered to your bank account. Moreover, the bank account linked to the UPI ID is yours and not of any third person; otherwise, your bid will be rejected.

Step 5: You can place the bid once you enter the UPI ID and ensure the quantity is in multiple lots. You have two options for the price: either you can choose the cut-off price or a different price in the “price” option. 

Step 6: Post submitting your bid, click on the checkbox and confirm you have read the offer documents related to the IPO carefully. These include all the terms and conditions for investing in an IPO.

Step 7: Now click on “Continue.”

Step 8: For the final step, you only need to accept the mandate request on your UPI app. The payment can take a minimum of three days to reflect in your account.

Step 9: To reconfirm your application, you can check the status of the same in the “My Applications” tab. You will also receive an SMS from the exchange for confirmation of the same.

Conclusion

After reading the above blog, we hope you have a fair knowledge of the CarTrade tech IPO to be launched soon. Even if you are a beginner, you can easily apply a CarTrade IPO to your portfolio through the TradeSmart platform and become a part of this next huge launch of 2021.

FAQ

What are the open and close dates of the CarTrade IPO?
The Initial Public Offering of CarTrade Limited will open for Subscription on August 9, 2021 (Monday) and will close on August 11, 2021 (Wednesday).

What is the price range for applying for the CarTrade IPO?
The offer price for CarTrade IPO has been fixed at Rs 1585 to Rs 1618.

What is the lot size and minimum order quantity of the CarTrade IPO?
Investors can subscribe to the IPO by applying for a lot of 9 shares or in multiples thereof.

For the CarTrade IPO what is the Maximum Subscription Amount for Retail Investors?
The amount is Rs 2 lakhs.,i.e maximum of 13 lots at the upper end of the price band.

What is the allotment date for the CarTrade IPO?
The shares will be alloted around August 17, 2021

Who is the registrar of CarTrade IPO?
The registrar is Link Intime India Private Limited.

When will the shares of CarTrade be listed on the exchanges?
The shares of the company will be listed on August 23, 2021 on both NSE & BSE