Some of India’s biggest online used-car platforms are scaling back operations and pruning non-core businesses as they prepare for initial public offerings that could together raise over $1 billion.
The three unicorn startups namely CARS24, CarDekho and Spinny are holding early discussions with bankers to gauge investor appetite and assess restructuring needs ahead of potential listings within the next 12 to 18 months, Bloomberg reported, citing sources.
Formal advisers are yet to be appointed.
The three companies are looking to tap into strong investor demand for India-focused firms.
India has emerged as the world’s third busiest IPO market this year, with domestic listings raising more than $10 billion so far, according to Bloomberg.
SoftBank-backed CARS24 has been the most aggressive in cutting costs, shutting its spare-parts arm Inspare and car-servicing unit FourDoor while laying off staff across tech and product teams.
The company, which posted a $567 million loss in FY24, had earlier raised $450 million at a $3.2 billion valuation in 2021.
CarDekho, run by Girnar Software, has delayed filing IPO papers that were initially expected in early 2025 and is instead planning to merge its insurance business with RenewBuy, according to multiple media reports.
Spinny, officially Valuedrive Technologies, has slowed expansion while seeking new funding.
Smaller rival Droom has also restructured, shifting its focus to premium cars and cutting costs after a revenue slump, Bloomberg noted.
Investor pressure is pushing these startups to become leaner and profitable as private funding in the crowded used-car market dries up.
Early backers of the sector include Google Capital, Tencent and Tiger Global.
Currently, CarTrade Tech, the operator of CarWale and CarTrade, is the only publicly traded player in the segment.
Its 2021 IPO was oversubscribed 20 times, and its shares have climbed 63 per cent this year, compared with a 7 per cent rise in the benchmark Nifty 50.