CarTrade Tech IPO GMP, Subscription, Allotment, Listing, Other Key Details

CarTrade Tech Limited received a good response for its initial public offering (IPO) on Wednesday. The IPO came to a close after three days of trading and subscriptions. The CarTrade Tech IPO saw a significant response from investors, as the company saw an overall subscription of 20.29 times its shares. The investor category that had subscribed to the issue the most was the non-institutional investor (NII) category, which subscribed around 41 times against their allotted shares. The runner-up was the group of qualified institutional buyers (QIBs). They had subscribed to the public issue a total of 35.45 times. The retail investors on the other hand subscribed to the IPO 2.75 times against their allotted shares. The company garnered bids for 26.31 crore equity shares against the issue size of 1.29 crore equity shares on the final day of bidding.

The CarTrade Tech IPO grey market premium (GMP) was Rs 150 on August 12. This indicated that the shares were trading at Rs 1,735 to Rs 1,768 per equity share on the unlisted grey market. The GMP for the issue on the last day of closing was Rs 320. Hence, the shared were trading at Rs 1,905 to Rs 1,938 per equity share on the grey market.

Given that the IPO has come to a close, the next order of business for the company is to go for the basis of allotment, which is most likely set to take place on August 17. The refunds to the investors who didn’t get shares will most probably be on August 18. Meanwhile, the successful bidders who snagged shares will see the same deposited to their Demat accounts on August 20. The listing date for the issue is set for August 23, though this is not yet confirmed.

The company aimed to raise Rs 2,998.51 crore through its public issue which was entirely an offer for sale (OFS). The issue contained 18,532,216 equity shares, but the company reduced the issue size from that to 1.29 crore equity shares after raising around Rs 900 crore from its anchor investors. The object of the issue was to carry out the OFS and achieve the benefits of listing its shares on the stock exchanges.

CarTrade Tech Limited is a multi-channel auto platform provider. Essentially, the company connects new customers to used automobile customers so they can buy and sell their vehicles. The platform also caters to vehicle dealers, vehicle OEMs, and other businesses that deal in the buying and selling of vehicles. Apart from sales transactions, the company also facilitates marketing financing, among other activities.

Speaking on the company’s position in the market, Religare Broking said, “CarTrade operates on an asset-light business model and is well placed in the automotive value chain with a combination of online and offline related services. The company has a strong brand recall value and is gaining popularity amongst customers and stakeholders. Further, their investments in technology have made their platforms scalable in a highly capital-efficient manner.”

“India became the 5th largest car market in the CY20. Domestically, the two-wheeler segment dominates the market in terms of volume, owing to a growing middle class and a young population. Moreover, the rising interest of companies in exploring the rural markets further aided the growth. By 2025, India is expected to become the world’s 3rd largest automotive market in terms of volume, driven by key factors such as digitization, changing consumer behavior and innovative services,” said Religare Broking, adding to the view on the market scenario in India.