CarTrade Stake Sale: Highdell, MacRitchie Initiate ₹400 Cr Block Deal

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Synopsis:

Highdell and MacRitchie are selling up to 10.4% of CarTrade in a ₹500 crore block deal, starting at ₹820 per share (4.3% discount). The lock-up period is 75 days. CarTrade aims for growth despite recent stock declines, driven by optimistic analyst forecasts.

CarTrade News Today

Highdell Investment and MacRitchie Investments Pte are executing a significant block trade involving CarTrade. The transaction, valued at ₹400 crore initially, includes an option to increase by an additional ₹100 crore, setting the stage for a potential total of ₹500 crore.

Stake Details

The block deal represents 10.4% of CarTrade's total equity, with an upsize option that could extend to 13%. Highdell Investment plans to sell 7% of the company's stake, while MacRitchie Investments intends to divest 3.4%, with possible increases to 8.7% and 4.3%, respectively.

Explore: Cartrade Tech Limited Share Price

Pricing and Financial Implications

The floor price for the transaction is fixed at ₹820 per equity share, presenting a 4.3% discount compared to CarTrade's recent closing price. This pricing strategy aims to attract buyers while managing shareholder interests during the 75-day lock-up period.

Market Reaction and Strategic Insights

Despite a recent downturn of nearly 5% in the past month, the stock has maintained a positive year-to-date growth of 19%. Analysts, including Nomura India, anticipate robust revenue growth in the consumer and OLX segments, driven by increased new car inventory and stronger value propositions in the used car market.

Nomura India further forecasts a healthy 20% revenue compound annual growth rate (CAGR) for CarTrade Tech between FY24 and FY26 in its consumer and OLX businesses.

Conclusion

The stake sale by Highdell and MacRitchie underscores strategic portfolio adjustments amidst optimistic market projections for CarTrade. Investors and analysts will closely monitor the outcome of the block deal and its impact on the company's future growth trajectory.

Disclaimer: Investments in the securities market are subject to market risk, read all related documents carefully before investing.

This content is for educational purposes only. Securities quoted are exemplary and not recommendatory.

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