CarTrade Tech shares jump 19% as company says it will acquire OLX Auto's India business

CarTrade Tech share price: The company has entered into a share purchase agreement to acquire a 100 per cent stake in Sobek from OLX India BV subject to the completion of certain conditions, CarTrade Tech said in a regulatory filing.

Representative image. Source: Unsplash

CarTrade Tech share price: Shares of CarTrade Tech jumped as much as 18.8 per cent to Rs 578.80 apiece on the BSE intraday on Tuesday, July 11 after the company announced it had inked a pact to acquire Sobek Auto India for a consideration of Rs 537 crore. Sobek is engaged in the business of running an automotive digital platform and a classified internet business.

The company has entered into a share purchase agreement to acquire a 100 per cent stake in Sobek from OLX India BV subject to the completion of certain conditions, CarTrade Tech said in a regulatory filing.

The acquisition is in furtherance of the strategic objectives of the company to undertake investments which provide synergistic benefits to the existing businesses of CarTrade Tech, it said.

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On June 30, 2023, Sobek acquired the classifieds internet business from OLX India on the terms and conditions agreed under a business transfer agreement.

The stock ended at Rs 556.30, up 14.27 per cent on the BSE. CarTrade Tech shares were listed on August 20, 2021.

CarTrade Tech's IPO

Online auto classified platform CarTrade Tech had fixed a price band of Rs 1,585–1,618 a share for its nearly Rs 2,999 crore initial public offering. The IPO opened for subscription on August 9 and concluded on August 11, 2021. The initial share sale was entirely an offer for sale (OFS) of 18,532,216 equity shares. The IPO was overall subscribed 20.29 times.

About CarTrade Tech

The CarTrade platform allows customers to buy and sell used cars as well as new cars. It is a multi-channel auto platform with coverage and presence across vehicle types and value-added services through its brands -- CarWale, CarTrade, Shriram Automall, BikeWale, CarTrade Exchange, Adroit Auto, and AutoBiz.

The company's consumer platforms—CarWale, CarTrade, and BikeWale—collectively get 3.2 crore average unique visitors every month (during the 3-month period ending March 31, 2021), and Shriram Automall and other auction platforms had 8,14,316 vehicles listed for auction during FY 2021.

The company generates revenues from commissions and fees from auctions and remarketing services, online advertising solutions, lead generation, technology-based services to original equipment manufacturers, dealers, banks, and other financial institutions, and inspection and valuation services, the company said at the time of its IPO launch.

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