Droom IPO: Automobile marketplace files Rs 3,000 Cr IPO papers

As per the draft red herring prospectus (DRHP), the Initial Public Offering (IPO) by promoter Droom Pte Ltd, comprises fresh issuance of equity shares worth Rs 2,000 crore and an offer for sale to the tune of Rs 1,000 crore.

The online marketplace for automobiles, Droom Technology, has filed preliminary papers with capital markets regulator SEBI to raise Rs 3,000 crore through initial share-sale

As per the draft red herring prospectus (DRHP), the Initial Public Offering (IPO) by promoter Droom Pte Ltd, comprises fresh issuance of equity shares worth Rs 2,000 crore and an offer for sale to the tune of Rs 1,000 crore.

The promoters – Sandeep Agarwal and Droom Pte Ltd – hold 100% shares in the company. 

The company may consider private placement of equity shares totaling Rs 400 crore. If the pre-IPO placement is done, the size of the fresh issue will be reduced. The proceeds from the fresh issue will be used for organic as well as inorganic development initiatives and for general corporate purposes. 

Droom, announced in July that it was raising up to USD 200 million (over Rs 1,487 crore) in multiple tranches and has already raised a significant chunk of the amount.

Currently the automobile technology competes with startups such as CarDekho, Cars24, Spinny and CarTrade. 

It has previously raised approximately USD 125 million from investors including Lightbox, Beenext, Digital Garage, Integrated Asset Management, Toyota Tsusho Corporation and others. 

ICICI Securities, Axis Capital, Edelweiss Financial Services, HSBC Securities and Capital Markets (India) Pvt Ltd and Nomura Financial Advisory and Securities (India) Pvt Ltd are the book running lead managers to the issue.