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Exclusive: Cars24 raises $259 Mn at around $1.75 Bn valuation


Cars24 has emerged as a leader in the used car space and it’s become more evident from the company’s scale, global ambition and its new round. The Gurugram-based venture has raised $258.6 million from eight investors.

DST Asia, Alpha Wave Incubation and Tencent (via its Europe based special purpose vehicle or SPV: Zennis Capital BV) have put in $75 million each whereas Moore Strategic Partners has invested $22.7 million, the company’s regulatory filings in Singapore show.

New York-based existing backer Exor Seeds has poured in $8.3 million. HPS Investment Partners’ chief executive officer Scott Kapnick and BloombergSen Investment Partners have invested $2.2 million and $472K respectively. 

According to Fintrackr’s estimates, Cars24 has been valued anywhere between $1.72 to $1.75 billion. The company was the first to turn unicorn from the used car space with a little over $1 billion valuation in November last year.

Cars24 was reportedly in talks to raise $300-$350 million at around a $2 billion valuation in which SoftBank is likely to participate. 

Cars24 used to only buy cars on behalf of dealers until 2019. However, it diversified into selling to retail customers and now directly competes with CarDekho, Spinny and Droom. Its indirect competitors include Mahindra First Choice and Maruti True value. Besides India, the firm also expanded its offerings to the Middle East, Australia and the UK markets. 

Cars24’s shareholding pattern and ESOP pool expansion

After the allotment in this round, DST Asia has emerged as the largest stakeholder in the company with 22.8% stake while new investors Alpha Wave and Tencent have picked up 4.5% stake each.


Promoters’ group which includes co-founders Mehul Aggarwal, Vikram Chopra, Gajendra Jangid and Ruchit Aggarwal saw their collective holding dilute to 13.93%. 

On the lines of many growth-stage companies, Cars24 has also expanded its ESOP pool. The company has passed a resolution to increase its ESOPs pool to 27,81,345 options and it is now worth around $72.3 million, separate filings show.

Cars24’s financials and secondary transactions

Cars24’s early backers MPGI Holdings, Asia Venture Group and Siegfried Trust and its four co-founders had offloaded $20 million worth shares across two secondary deals since December. Importantly, the co-founders also received bonus shares worth $36 million from Cars24.

Entrackr had exclusively reported Cars24’s secondary transaction in August.

While the company is yet to file annual financial statements for FY21, its operating revenue grew 82% to Rs 1,687 crore in FY20. According to Fintrackr, the company had shrunk its losses by 125% to Rs 285 crore in FY20.

The used cars space picking up steam

The used cars space has turned out to be an attractive segment for venture capitalists and late-stage investors. Droom had claimed unicorn status in July with up to $200 million round while pure-play etailer Spinny had nabbed over $100 million in Series D round led by Tiger Global.

Spinny also expanded its ESOP pool size to $45 million in July. According to Entrackr sources, the company is witnessing a lot of inbound interest from investors and it may raise a round by the end of this year.

CarTrade, one of the early players from the segment, made its debut on the stock exchange in August. Jaipur-based CarDekho is in the advanced stages to raise a new round that could push its valuation over $1 billion.

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