business · 2026-07-10
CarDekho Eyes ₹3.5K Cr IPO This Quarter
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Girnar Software plans to file its DRHP with SEBI this quarter for a ₹3K-3.5K Cr IPO, targeting a ₹13K-15K Cr valuation, up from ₹9K Cr five years ago.~90% of the IPO is an offer for sale, not fresh capital. CarDekho says it has positive operating cash flow and doesn't need primary capital, making this largely an exit event for investors.Peak XV Partners, Hillhouse Capital, CapitalG, and HDFC Bank are among backers likely selling. Listed rival CarTrade and IPO-bound Cars24 face a more crowded public market.
What exactly will CarDekho's IPO include?
The IPO bundles CarDekho's auto classifieds (CarDekho, BikeDekho, ZigWheels), loan disbursal arm Rupyy, and mobility businesses Revv and Carrum. InsuranceDekho is excluded. It will pursue a separate listing after its merger with RenewBuy closes, targeting a ₹3K-4K Cr IPO by Mar 2027.
Why was InsuranceDekho carved out?
InsuranceDekho is merging with RenewBuy, an insurance distribution platform. Until that merger closes, expected in 3-4 quarters, a clean listing isn't possible. The merged entity plans its own ₹3K-4K Cr IPO by Mar 2027. Keeping it separate avoids regulatory complexity of listing a mid-merger asset.
How did FY25 financials shape the IPO size?
CarDekho posted ₹2,795 Cr operating revenue in FY25, up 24% YoY, but net loss was still ₹266 Cr. The company initially planned a $300Mn IPO in 2024 but deferred to chase profitability. With FY26 revenue expected to grow ~15% and EBITDA rising 20-25%, the numbers now support a ₹13K-15K Cr valuation pitch.
Who are the bankers and what route is used?
Axis Bank, IIFL, Goldman Sachs, and Nomura are mandated. CarDekho may file via SEBI's confidential route, which lets the company share financials with SEBI and select institutional investors before the DRHP becomes public. This shields sensitive data from competitors like Cars24 during the review period.
Why is 90% of this IPO an offer for sale?
CarDekho has positive operating cash flow and ~$750Mn in total funding raised to date. Fresh issue is only ~10% of total size, roughly ₹300-350 Cr. The rest lets early backers like Peak XV and Hillhouse exit after holding stakes since the 2021 unicorn round. The company says it simply doesn't need more primary capital.
Could CarDekho have raised this via private round?
It could have, but a private round at ₹13K-15K Cr would require finding a single buyer or consortium willing to write a very large check. Public markets offer broader price discovery. More importantly, early investors like Peak XV and Hillhouse want liquidity after holding for years. A private secondary sale would likely fetch a lower valuation.
What loss level do public markets tolerate?
Indian public markets have accepted loss-making tech IPOs, but with limits. Zomato listed with a ₹812 Cr FY21 loss on ~₹3K Cr revenue, roughly 27% loss-to-revenue ratio. CarDekho's ratio is ~9.5%, much healthier. Investors focus on loss trajectory and EBITDA improvement, both of which CarDekho can show with 20-25% EBITDA growth expected in FY26.
Does the OFS-heavy structure affect listing?
OFS-heavy IPOs don't bring new capital into the company, so investors watch whether the business can self-fund growth. Paytm's IPO was 90% OFS and the stock fell 27% on listing day, partly because investors questioned growth funding. CarDekho's positive operating cash flow argument is meant to counter exactly this concern.
How does this change the race with Cars24?
CarTrade is already listed but tried to acquire CarDekho for ~$1.2Bn last year before the deal collapsed in Nov. Cars24 is also IPO-bound. Three auto classifieds players going public within a short window forces investors to compare unit economics directly. CarDekho's ₹2,795 Cr FY25 revenue dwarfs CarTrade's, but it still posted a ₹266 Cr net loss.
What valuation multiple is CarDekho seeking?
At ₹13K-15K Cr valuation on ~₹2,795 Cr FY25 revenue, CarDekho targets roughly 4.8-5.4x revenue. Listed peer CarTrade trades at ~6x revenue but is profitable. For context, Zomato at IPO was priced at ~25x revenue. CarDekho's multiple is modest by tech standards but still demands investors to believe in its path to profitability.
Why did the CarTrade acquisition fall apart?
CarTrade offered ~$1.2Bn to acquire both CarDekho and BikeDekho. Talks ran through most of 2025 but collapsed in Nov. The gap was likely valuation. CarDekho's founders believed an independent IPO at ₹13K-15K Cr would deliver more value than a $1.2Bn acquisition that included BikeDekho. Post-collapse, both pursued separate public listings.
Will Cars24's IPO timing clash directly?
Cars24 is also IPO-bound but hasn't disclosed its timeline. If both file DRHPs in the same quarter, institutional investors must allocate between two auto-classifieds bets. This is unusual. When PolicyBazaar and Star Health listed weeks apart in 2021, insurtech investor attention split visibly. A staggered timeline benefits whichever company lists first.
Source: inc42.com