Droom Files IPO Papers With SEBI To Raise INR 3,000 Cr In July this year, Droom joined the Unicorn club after raising part of its $200 million pre-IPO round
By S Shanthi •
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Online automobile transactional platform, Droom, has filed preliminary papers with the capital market regulator SEBI to raise INR 3,000 crore through an initial share sale. According to the DRHP (draft red herring prospectus), the initial public offering (IPO) comprises fresh issuance of equity shares worth INR 2,000 crore and an offer for sale worth INR 1,000 crore by the promoter.
Out of the net proceeds from the fresh issue part of the offer, around INR 1,150 crore will be used for funding organic growth initiatives and about INR 400 crore for funding inorganic initiatives and the rest for general corporate purposes.
"Our company may, in consultation with the BRLMs, consider a further issue of equity shares, including by way of a private placement or any other methods as may be permitted in accordance with applicable law, for cash consideration aggregating up to INR 4,000 million, at its discretion, prior to the filing of the Red Herring Prospectus with the RoC ("Pre-IPO Placement")," the DRHP read.
In July this year, Droom joined the Unicorn club after raising part of its $200 million pre-IPO round from new investors such as 57 Stars and Seven Train Ventures along with existing investors. It had earlier raised about $125 million in funding from investors including Lightbox, Beenext, Digital Garage, Integrated Asset Management, Toyota Tsusho Corporation and others.
"For four or five months after the first lockdown, Droom's business was almost zero. But by December 2020, it reached an all-time peak, which was higher than the previous pre-COVID-19 peak. And from December until August, each month has been significantly bigger than the prior month," Sandeep Aggarwal, founder and CEO, Droom, told Entrepreneur India in an earlier interview.
Founded in 2014 as an online marketplace for automobiles, today, Droom's products include a core marketplace where any individual dealer or OEM can buy or sell, Orange Book Value, which is the pricing engine for the vehicle, ECO which is the inspection service for a used vehicle, the historical record for the used vehicle and Droom Discovery which gives customers a lot of research tools while buying, Droom financial services, which include loan and insurance, roadside assistance, an extended warranty and then Droom velocity, which takes care of the last mile fulfillment and delivery.
