Online Car Marketplace Droom to join the IPO bound queue
- ByTejika Bajaj | November 13, 2021
The automobile e-commerce space Droom is all set to join the IPO bound queue as it files its Draft Red Herring Prospectus with the regulatory authority SEBI to raise Rs. 3000 crore through IPO. Droom’s IPO would be second in the automotive commerce industry following Cartrade.
The company intends to offer Rs. 2000 crore as fresh issue of equity shares and Rs. 1000 crore as offer for sale by Droom Pte (the sole promoter of Droom).
The company intends to utilize the capital raised from the IPO for multiple purposes. It plans to use Rs. 1,150 crore for organic growth initiatives like expansion into Tier 3 and 4 cities, international expansion, acquisition and marketing and branding activities for sellers and buyers. Additionally, it aims to utilize Rs. 400 crore towards funding inorganic growth.
The automotive platform has also mentioned in its DRHP that it may consider pre-IPO placement of equity shares worth Rs.400 crore. The company has assigned ICICI Securities, Nomura Financial Advisory and Securities, Axis Capital, Edelweiss Financial Services, HSBC Securities and Capital Markets and KFin Technologies as the joint bookkeepers of the offering.
Founded in 2014 by Sandeep Agarwal, Droom is an e-commerce marketplace for sale of second-hand cars, 2-wheelers and other vehicles. The company claims to have the largest selection of cars i.e. 2.9 lakh cars across more than 1,100 cities.
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