Closure of OLX Auto biz pushes CarTrade into losses in Q3 FY24

Automobile classifieds platform CarTrade recorded over 15% growth in scale during the quarter ending December 2023 but also slipped into red at the same time.

The losses were due to the discontinued operations of the auto sales business (C2B consumer-to-business operations) of OLX.

CarTrade shut down the C2B model citing unsustainable unit economics in October 2023. The company acquired OLX India’s auto business in a deal worth Rs 537 crore in July last year.

CarTrade’s revenue from operations grew 15.5% to Rs 138.6 crore in Q3 of FY24 as compared to Rs 120 crore in the previous quarter (Q2 FY24), according to its consolidated financial statements with the National Stock Exchange.

In comparison to the third quarter of the previous fiscal year (Q3 FY23), its operating revenue has surged 42.6% from Rs 97.2 crore.

CarTrade generated 35.7% of its revenue from consumer segment amounting to Rs 49.42 crore while its remarketing and classifieds verticals delivered Rs 46 crore and Rs 43.1 crore, respectively, in Q3 FY24.

The company’s overall revenue (including non-operating income of Rs 13.27 crore) reached Rs 151.85 crore at the end of Q3 FY24.

On the expense front, employee benefits expenses formed 54% of the overall spendings which went up 12.3% to Rs 67.56 crore during the period. This cost also includes share-based expenses of Rs 4.56 crore.

CarTrade’s overall expenses increased 13.6% to Rs 125 crore in Q3 FY24 from Rs 110 crore during Q2 of the same fiscal year.

Following a loss of Rs 45.51 crore due to discontinued operations of OLX auto business, CarTrade slipped into red to book a loss of Rs 23.55 crore in Q3 against Rs 5.04 crore profit in the previous quarter of FY24.

Excluding the losses due to the closure of OLX auto business, CarTrade posted a profit of Rs 21.96 crore, which would be a 4.3X growth compared to Q2 FY24.

In Q3 FY23, the company had posted  Rs 14.04 crore in profits.

On a unit level, the company spent Re 0.9 to earn a rupee in Q3 of FY24.

For the nine months period (Apr-Dec 2024) of FY24, CarTrade recorded Rs 344.7 crore revenue from operations with a loss of Rs 5 crore.

CarTrade went public in May 2021 and raised around Rs 2,000 crore via an offer-for-sale. It was listed on the NSE at nearly Rs 1,600 per share in August 2021 and is currently trending around Rs 691.5 per share with a market cap of Rs 3,240 crore or $390 million.