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Droom… goes for IPO to raise Rs 3K cr

Auto e-com co files DRHP with SEBI

Droom Technology is the second Indian automobile online company to go public as CarTrade has recently floated its IPO

MUMBAI, Nov 13 (The CONNECT) - Automobile e-commerce platform Droom Technology Limited has filed its Draft Red Herring Prospectus (DRHP) with capital market regulator SEBI to raise funds through an initial public offering (IPO).

This the second Indian automobile online company to go public as CarTrade has recently floated its IPO. CarTrade Tech scrip is trading at Rs 1,117 apiece when the bourses closed on Friday.

The Droom IPO consists of equity shares of face value of Re. 1 each of Droom Technology.  The offer comprises of fresh issue of aggregating up to Rs 2,000 crore and an offer for sale of up to Rs 1,000 crore by Droom Pte. Ltd, the holding company based in Singapore. The equity shares of the company will be listed on the BSE and NSE.

Additionally, the company, in consultation with the lead bankers to the issue may consider a further issue of equity shares including a private placement aggregating up to Rs 400 crore. If such placement is completed, the fresh issue size will be reduced.

The company intends to utilise the net proceeds from the fresh issue to fund organic and inorganic growth initiatives aggregating to Rs 1,150 crore and Rs 400 crore respectively and towards general corporate purposes.

Droom is a technology and data science company that facilitates automobile buying and selling online through a combination of their asset light ecommerce platform with a vertically integrated ecosystem of products and services.

The Company is the only major Indian player with a completely online transactional model and offer one of the largest selection of automobiles amongst the major online players in India, according to a Grant Thornton Report with over 1.15 million vehicles listed that includes both used and new cars and two-wheelers, and other vehicles, as of September 30, 2021.

For the six months ended September 30, 2021, it has seen 89.27mn visits on its website/app, and has 20,725 Auto Dealers, present in 1,151 cities. It has 2,78,807 used vehicles in 11 categories listed valued at Rs.146.49 bn, and it sold 56,412 vehicles and has a GMV of Rs 59,347.25 mn

Droom is led by an experienced leadership team with significant industry experience. Sandeep Aggarwal, Founder, Promoter, Chairman, Whole-time Director and Chief Executive Officer, has over 20 years of experience in the technology and start-up space and has in the past founded, ShopClues.com, a leading Indian e-commerce platform. Akshay Singh is currently the CSO (Chief Strategy Officer) and Mohit Ahuja the Chief Marketing Officer.

The Indian automotive industry is currently the fifth-largest automotive industry and is expected to be the world’s third-largest automotive industry in terms of volume by Fiscal 2026, propelled by demographic drivers such as rising disposable income, growing middle class, urbanization and a growing preference for personal mobility. It is poised to grow at 17.3% CAGR from Fiscal 2021 to Fiscal 2026 to reach Rs 36,725 billion by Fiscal 2026.

ICICI Securities Limited, Axis Capital Limited, Edelweiss Financial Services Limited, HSBC Securities and Capital Markets (India) Limited and Nomura Financial Advisory and Securities (India) Private Limited are the book running lead managers to the issue.

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