Please refer to important disclosures at the end of this report
1
Cartrade Tech Limited (Cartrade)
was incorporated on April 28, 2000. Cartrade
is a multi-
channel auto platform with coverage and presence across vehicle types
and value-
added services. They offer a variety of solutions across the automotive
transaction value chain for marketing, buying,
selling and financing of new and
pre-owned cars, two-wheelers as well as pre-
owned commercial vehicles and
farm and construction equipment. Their platforms operate under several brands:
CarWale, CarTrade, Shriram Automall, BikeWale, CarTrade Exchange, Adr
oit
Auto and AutoBiz.
Their platforms are operated by 221 technology employees
working at their 3 technology centers as of June 30, 2021. In the 3 months
ended June 30, 2021, their consumer platforms, CarWale, CarTrade and
BikeWale collectively had an aver
age of 27.1 million unique visitors per month,
with 88.14% being organic visitors.
Positives: (a) The Company is leading marketplace for auto sales (b)
Cartrade
has strong brands, better technology
(c) Profitable and Scalable business model
(d) Good financial track records (e) Experienced B
oard and senior management
team.
Investment concerns: (a) Overall slowdown in the automobile industry
could
impact revenue growth of the company.
Outlook & Valuation: In terms of valuations, the post-
issue FY2021 PE works out
73.4x to (at the upper end of the issue price band). There are no listed peers for
comparison. However, the company is doing better compared to its
unlisted
peers in terms of financial. We believe the
company has a strong brand, better
technology platforms, a profitable & scalable business model.
Hence , we
recommend a subscribe rating on the issue.
Exhibit 1: Key Financials
Y/E March (Rs cr) FY2019
FY2020 FY2021
Net Sales
243
298
250
% chg -
22.6
(16.3)
Net Profit
26
31
101
% chg -
17.1
1.3
OPM (%)
12.1
13.3
15.8
EPS (Rs)
5.7
6.8
22.1
P/E (x)
286.1
237.0
73.4
P/BV (x)
6.0
5.9
4.4
RoE (%)
2.1
2.5
6.0
RoCE (%)
1.1
1.7
1.1
EV/Sales (x)
29.4
23.9
27.2
EV/EBITDA (x)
242.0
180.2
172.8
Source: Company, Angel Research
Subscribe
Issue Open: Aug 09, 2021
Issue Close: Aug 11, 2021
Offer for Sale:1.85cr share
QIBs 50%
Non-Institutional 15%
Retail 35%
Promoters 0.0%
Public 100.0%
Post Issue Shareholding Pattern
Post Eq. Paid up Capital:
`45.8
cr
Issue size (amount):
`2,999cr
Price Band:
`1585
-1618
Lot Size: 9 shares
Post-issue mkt.cap:
`7,265
*– 7,416cr**
Promoters holding Pre-Issue: 0%
Promoters holding Post-Issue: 0%
*Calculated on lower price band
** Calculated on upper price band
Book Building
Fresh issue:
NIL
Issue Details
Face Value:
`
10
Present Eq. Paid up Capital:
`45.8
cr
Amarjeet S Maurya
+022 39357600, Extn: 6831
amarjeet.maurya@angelbroking.com
CarTrade Tech Ltd
IPO Note | Au
tomobile
August, 06, 2021
CarTrade Tech Ltd |
IPO Note
August 06, 2021
2
Company background
Cartrade Tech Limited was incorporated on April 28, 2000. Cartrade is a multi-
channel auto platform with coverage and presence across vehicle types and
value-added services. They offer a variety of solutions across the automotive
transaction value chain for marketing, buying, selling and financing of new and
pre-owned cars, two-wheelers as well as pre-owned commercial vehicles and
farm and construction equipment.
Their platforms operate under several brands: CarWale, CarTrade, Shriram
Automall, BikeWale, CarTrade Exchange, Adroit Auto and AutoBiz.
Their platforms are operated by 221 technology employees working at their 3
technology centers as of June 30, 2021. In the 3 months ended June 30, 2021,
their consumer platforms, CarWale, CarTrade and BikeWale collectively had an
average of 27.1 million unique visitors per month, with 88.14% being organic
visitors.
Their brands, CarWale and BikeWale, ranked number one on relative online
search popularity when compared to their key competitors over the period from
April 2020 to March 2021. Company’s marquee institutional shareholders
include Highdell Investment Ltd (affiliate of Warburg Pincus LLC), and
MacRitchie Investments Pte. Ltd. (an affiliate of Temasek), JP Morgan and March
Capital.
Issue details
Cartrade is raising `2,999cr through offer for sale and Investors are
selling equity
share 1.85cr in the price band of `1,585-1,618.
Exhibit 1: Pre and post IPO shareholding pattern
No of shares (Pre-issue)
% No of shares (Post-issue) %
Promoters
- 0.0% - 0.0%
Public 45,834,067 100.0%
45,834,067 100.0%
Total 45,834,067 100.0%
45,834,067 100.0%
Source: Source: RHP, Note: Calculated on upper price band
Objectives of the Offer
To carry out an offer for sale
To achieve the benefits of listing the Equity Shares on the stock
exchanges.
CarTrade Tech Ltd |
IPO Note
August 06, 2021
3
Exhibit 2: Consolidated Income Statement
Y/E March (` cr) FY2019 FY2020 FY2021
Net Sales
243
298
250
% chg
22.6
(16.3)
Total Expenditure
214
259
210
Raw Material
0
17
1
Personnel
128
133
130
Others Expenses
86
108
79
EBITDA
30
40
39
% chg
34.3
(0.7)
(% of Net Sales)
12.1
13.3
15.8
Depreciation& Amortisation
15
17
20
Impairment of non financial asset
-
-
-
EBIT
14
22
19
% chg
55.7
(12.6)
(% of Net Sales)
5.9
7.5
7.8
Interest & other Charges
2
3
4
Other Income
24
20
32
(% of PBT)
66.4
51.8
67.8
Share in profit of Associates
-
-
-
Recurring PBT
35
39
47
% chg
9.8
20.7
Tax
10
8
(54)
(% of PBT)
26.9
19.6
(115.2)
PAT (reported)
26
31
101
Basic EPS (`)
5.7
6.8
22.1
% chg
20.7
223.0
Source: Company, Angel Research
CarTrade Tech Ltd |
IPO Note
August 06, 2021
4
Consolidated Balance Sheet
Y/E March (` cr) FY2019 FY2020 FY2021
SOURCES OF FUNDS
Equity Share Capital
38
38
42
Reserves& Surplus
1,193
1,224
1,638
Shareholders Funds
1,231
1,262
1,681
Total Loans
34
42
55
Deferred Tax Liability
10
8
6
Total Liabilities
1,330
1,383
1,823
APPLICATION OF FUNDS
Net Block
1,010
1,016
1,023
Capital Work-in-Progress
-
0
0
Investments
287
295
645
Current Assets
127
157
196
Inventories
1
0
2
Sundry Debtors
36
47
47
Cash
22
22
24
Loans & Advances
26
38
49
Other Assets
42
51
74
Current liabilities
97
88
107
Net Current Assets
30
69
89
Deferred Tax Asset
3
3
65
Total Assets
1,330
1,383
1,823
Source: Company, Angel Research
CarTrade Tech Ltd |
IPO Note
August 06, 2021
5
Consolidated Cash Flow Statement
Y/E March (` cr) FY2019 FY2020 FY2021
Profit before tax
35
39
47
Depreciation
15
17
20
Change in Working Capital
7
(30)
(5)
Interest / Dividend (Net)
(0) (0) (2)
Direct taxes paid
(17)
(9)
(10)
Others
(6)
1
(14)
Cash Flow from Operations
35
17
35
(Inc.)/ Dec. in Fixed Assets
(24)
4
(336)
(Inc.)/ Dec. in Investments
3
(12)
(5)
Cash Flow from Investing
(20)
(8)
(341)
Issue of Equity
0
0
322
Inc./(Dec.) in loans
(3) (8) (9)
Dividend Paid (Incl. Tax)
0
0
0
Interest / Dividend (Net)
(2) (3) (4)
Cash Flow from Financing
(5)
(11)
308
Inc./(Dec.) in Cash
9
(2)
2
Opening Cash balances
12
22
20
Closing Cash balances
22
20
22
Source: Company, Angel Research
CarTrade Tech Ltd |
IPO Note
August 06, 2021
6
Key Ratios
Y/E March
FY2019
FY2020 FY2021
Valuation Ratio (x)
P/E (on FDEPS)
286.1
237.0
73.4
P/CEPS
180.3
152.4
61.3
P/BV
6.0
5.9
4.4
EV/Sales
29.4
23.9
27.2
EV/EBITDA
242.0
180.2
172.8
EV / Total Assets
5.4
5.2
3.7
Per Share Data (`)
EPS (Basic)
5.7
6.8
22.1
EPS (fully diluted)
5.7
6.8
22.1
Cash EPS
9.0
10.6
26.4
Book Value
268.7
275.4
366.7
Returns (%)
ROCE
1.1
1.7
1.1
Angel ROIC (Pre-tax)
1.5
2.3
1.8
ROE
2.1
2.5
6.0
Turnover ratios (x)
Asset Turnover (Net Block)
0.2
0.3
0.2
Inventory / Sales (days)
1
0
2
Receivables (days)
54
57
69
Payables (days)
136
98
145
Working capital cycle (ex-cash) (days)
(80)
(41)
(73)
Source: Company, Angel Research
CarTrade Tech Ltd |
IPO Note
August 06, 2021
7
Research Team Tel: 022
-
39357800 E
-
mail: research@angelbroking.
com Website:
www.angelbroking.com
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