Droom To Raise $150 Million Before IPO, Aims To Be Profitable By Year-End
That the U.S. has dropped all charges against founder Sandeep Aggarwal should serve as no hindrance for Droom’s listing on Nasdaq.
Used-car marketplace Droom Technology Pvt. Ltd. is confident of becoming profitable by the end of this year, and plans to raise $150 million before launching an initial public offering in 2021.
The auto portal had gross merchandise value of $1.2 billion and revenue of $32 million in 2019. Its platform processed more than 6.1 lakh orders last year.
"The plan has always been to take the IPO route and we have considered four options, (Mumbai, U.S., Singapore and Hong Kong)—it will most probably be Nasdaq in U.S.,” Sandeep Aggarwal, Droom's founder and chief executive officer, told Press Trust of India. “We appointed KPMG and Grant Thornton as auditors and also roped in Credit Suisse that is likely to take us to IPO as well.”
The company will raise one more round of "pre-IPO" funding of about $150 million this year, Aggarwal said.
The U.S. Department of Justice has dropped all charges against him in an insider-trading case when was a Wall Street analyst. A civil settlement has been reached with the U.S. Securities and Exchange Commission in connection with the same matter.
Thus, there should be no issues with listing Droom in New York, he said.
Aggarwal, who founded Droom in April 2014, said the company is focussing on keeping its cash burn low and is confident of hitting profit by the end of the year.
"Our cash burn is low. Unless we make some big investments that have not already been baked into estimates, we should be profitable by November this year," he said.
He added that Droom expects to clock a gross merchandise value of about $3 billion and a net revenue of $120 million in 2021.
The company has so far raised close to $125 million over six rounds of funding from investors like Lightbox, Beenext, Beenos, Digital Garage, Toyota Tsusho Corporation, and Integrated Assets Management.