Mar'25 View on Cartrade Tech Ltd

CarTrade Tech Ltd is a multi-channel auto platform provider company with coverage and presence across vehicle types and Value Added Services. The company operates various brands such as CarWale, CarTrade, Shriram Automall, BikeWale, CarTradeExchange, Adroit Auto, and AutoBiz. The platform connects new and used automobile customers, vehicle dealers, vehicle OEMs, and other businesses to buy and sell different types of vehicles. The company offers a variety of solutions across automotive transactions for buying, selling, marketing, financing, and other activities. The stock is on a strong momentum and looks to scale past 2000 level on back of the following inputs • Healthy growth in the standalone classifieds business. • EBITDA margin improvement across segments driven by cost controls. • OLX: Attempt to scale up the used car classifieds business. • Cartrade posted consolidated revenue growth of 27% yoy, driven by 38% yoy in standalone (core advertising + abSure), 27% yoy growth in SAMIL (remarketing segment) and the OLX acquisition. • The adjusted EBITDA margin of 28.4% was ahead of KIE’s estimate of 23.5%. * We raise FY25-27E EPS by 39-48%, as we model higher revenues and resultant operating leverage. • Stock is currently trading at valuation of 45.2x P/E FY27E EPS.