Online car marketplace CarDekho is looking at a valuation of $700 million based on which it is trying to raise around $100 million in fresh funding. According to a Mint report, Autohome Inc, a Chinese company that operates in a similar space like CarDekho may come on board as a strategic investor with $70 million. This would be the Series D funding for CarDekho.
Besides Autohome, existing investors, Sequoia Capital will also be an investor in this round. Sequoia is incidentally an investor in Autohome as well. However, there is no official confirmation on this development from any of the players involved.
Despite the overall sentiment in Indian automobile sector, particularly the passenger car segment going through one of its worst phases, CarDekho finds itself in an enviable position of attracting a strategic investor. CarDekho follows a model where it sells new as well as old cars on its platform. The slowdown effect does not seem to have impacted these online car dealers.
The company claims the interest among car buyers for vehicles whether new or used ones is still quite strong and there are some 300,000 enquiries for new and 150,000 enquiries for old cars on the CarDeko platform.
CarDekho has so far raised $185 million and a valuation of $700 million will be a definite increase from the levels of $400-$500 million it was valued last time when picking up $110 million in investment. Apart from Sequoia, another investor, Tybourne Capital is also common to Autohome and CarDekho.
An important fact to emerge from the experience these startups are going through is that the used car market is showing a big surge in demand. As a factor of number of second-hand cars sold to new ones, the figure has gone up from 0.8 to 1.2, an increase of 50% in this figure.