Gurugram-based Droom has raised USD 3 million (INR 25.73 crore) in fresh funding as it gears up to refile for its long pending IPO. The funding round was led by India Accelerator (IA) and its multi-stage VC arm Finvolve with participation from several other investors including Rameshchandra Shah, Rajkumar Sorathi, Hardik Kothiya and Shirish Patel.
Fueling Growth and IPO
The funds will be used to strengthen tech infrastructure, customer acquisition and pan-India expansion. According to founder and CEO Sandeep Aggarwal this is part of a broader plan to refile the IPO papers by 2025 and raise INR 1,000 crore (~ USD 115 million) in the public market.
This marks Droom’s second attempt at going public. The company had previously filed a draft red herring prospectus (DRHP) in 2021 with the Securities and Exchange Board of India (SEBI) to raise INR 3,000 crore but had to withdraw due to adverse market conditions. Droom is also planning a pre-IPO round of INR 200 crore to boost domestic shareholding, a strategy similar to what Zepto is doing.
Valuation and Investor Sentiment
According to the regulatory filings Droom raised USD 3 million (INR 25.73 crore) by issuing 15.6 lakh preference shares at INR 160 each, valuing the company at around USD 360 million (~ INR 3,089 crore) post-money. Aggarwal said this valuation was kept low to give Indian investors a big upside as they missed out on the growth phase of the company earlier.
Investor confidence in Droom remains strong. Ashish Bhatia, co-founder of Finvolve, described the company as a “category leader in Autotech”, expressing enthusiasm about its potential for an “impactful IPO and continued leadership.”
Droom IPO: Financial Performance
Droom has shown financial discipline by reducing consolidated net loss by 35% to INR 40.4 crore in FY24. However the company’s operating revenue dropped 66% to INR 85.4 crore from INR 253.3 crore in FY23. This revenue drop impacted the EBITDA margins which fell to -44% in FY24. But the company managed to reduce EBITDA loss to INR 37.2 crore from INR 57.3 crore in the previous year.
Strategic Shift and Business Model
Founded in 2014 by Sandeep Aggarwal, Droom initially focused on budget vehicles and then pivoted to mid-premium and luxury vehicles in 2022 and increased average profit per vehicle from INR 40,000 to INR 1.6 lakh. Today Droom is a full-fledged auto marketplace offering services like vehicle financing, rentals, advertising and software solutions.
The company has raised around USD 330 million (~ INR 2,832 crore) from investors like Lightbox, 57 Stars, Seven Train Ventures and Beenext.
Droom IPO: Among Several AutoTech IPO Hopefuls
Droom’s IPO plans are in line with the broader trend in India’s startup ecosystem. 2025 is going to be a big year for IPOs with Zepto, Ather Energy and CarDekho all gearing up for a public listing. In the AutoTech space CarDekho is planning to raise INR 3,000-4,000 crore, which further validates the investor interest in the sector.
Autotech Sector in India
India’s auto market is going digital and online marketplaces like Droom, CARS24, CarDekho and Spinny are using AI, AR and even Metaverse to enhance the car buying experience. With the overall vehicle market expected to grow from 5.1 million units in 2023 to 7.5 million by 2030 at 5.7% CAGR, Droom’s positioning in the digital auto space seems well timed.
The sector is getting a boost from the Indian government’s push for electric vehicles and alternative fuels and infrastructure investments and consumer preference for online vehicle transactions.
Conclusion
Droom’s latest USD 3 million (INR 25.73 crore) fundraise signals a renewed push toward IPO readiness, backed by notable investors and a clear strategy to deepen its footprint in the Indian automotive ecosystem. While its revenue slump in FY24 poses a challenge, its improved financial discipline, strategic realignment, and bullish industry trends suggest a compelling case for its second IPO attempt.
With IPO-bound companies racing ahead in 2025, all eyes will be on whether Droom can successfully drive into the public market and reclaim its place among India’s top AutoTech players.
For more details related to IPO GMP, SEBI IPO Approval, and Live Subscription stay tuned to IPO Central.