Cars24, India's first unicorn in the auto segment, has grown rapidly during the pandemic. Can it maintain its pace and focus?
Infographics: Sameer Pawar
Cut to March 2020, when the Covid-19 pandemic and lockdowns set in. “It looked like what we built in five years had become zero overnight,” says Chopra. Business recovery, he presumed, would at best happen by the end of the year or by March-April 2021. “I even thought that 2021 is lost.” The other concern was about how much share Cars24 would eventually reclaim. “Everything was in flux,” says Ruchit.
Eight months later, those fears have proven to be unfounded. In end November, Cars24 raised $200 million in a series E round of funding, which valued it at over $1 billion and made it the first unicorn in India’s auto segment. Chopra and his friends aren’t celebrating, yet. “Value creation matters more than valuation,” says Mehul. The unicorn tag, chips in Chopra, is more valuable to the world than to us. “All four of us are still very hungry and motivated to do more.”
They haven’t done too badly so far. From selling 18 cars in the first month, Cars24 is selling 15,000 a month now. Gross revenue in FY20 was Rs 3,065 crore, from Rs 417.64 crore in FY17. Its footprint has expanded from 12 cities in the first three years to over 130 cities now. Losses, which were Rs 76.35 crore in FY17, rose to Rs 325 crore in FY19, and reduced to Rs 277 crore in FY20. Market leader True Value, Maruti Suzuki’s pre-owned car network, started in 2001, and sold 4 lakh cars in FY20. Cars24, in comparison, sold over 1 lakh, and is now clocking a run-rate of 1.8-2 lakh for FY21. Investors in the company are delighted. According to DST Global—led by Israeli-Russian billionaire Yuri Milner, and which led the latest funding round in Cars24—what has worked for Cars24 is the way in which it stands out in a cluttered market. “Cars24 has pioneered a significantly differentiated experience for the customer and dealer by deeply leveraging data and technology, resulting in world-class operational efficiency and market leadership,” says Rahul Mehta, managing partner, DST Global.