Comparing FY22 Numbers For CARS24, Droom, Spinny

While CARS24 turned unicorn in November 2020, Droom and Spinny entered the coveted unicorn club in June 2021 and December 2021, respectively

At INR 5,136.5 Cr, CARS24 had the highest revenue among the three startups in FY22, while Spinny saw the biggest rise in operating revenue in terms of percentage

All three startups saw an increase in their net losses during the year under review, with Spinny seeing the biggest increase of 345% to INR 490 Cr

India’s used-car market has been thriving over the last few years due to the rise in disposable incomes and the young population of the country. The fear of contracting the Covid infection at the peak of the pandemic is believed to have further given a boost to this market. As per a report, India’s used-car market was valued at $23 Bn in FY22 and now is expected to double the growth at a CAGR of 19.5% till FY 2026-2027.

As per industry experts, the gap between sales of new cars and used cars will continue to narrow over the coming years. This has made the used-car market, which is currently mostly unorganised, a lucrative opportunity. A number of new-age tech startups, including CARS24, Droom, and Spinny, are trying to cash in on this opportunity and organise this market.

So, we decided to compare the financial performance of three startups – CARS24, Spinny, and Droom, which are trying to make a mark in the fast-growing but competitive market – in the financial year 2021-22 (FY22) to see how they stack against each other. 

It must be noted that while CARS24 turned unicorn in November 2020, Droom and Spinny entered the coveted unicorn club in June 2021 and December 2021, respectively. 

For a fair comparison, only the financials of the Indian entities of these three startups have been considered for this analysis. 

Revenue: CARS24 Leads The Way 

Vikram Chopra’s Gurugram-based car automobile marketplace CARS24 is miles ahead of Droom and Spinny in terms of revenue. The startup’s operating revenue jumped 87% to INR 5,136.5 Cr in FY22 from INR 2,741.3 Cr in the previous fiscal year.

The higher revenue is likely due to the vast and ever-expanding network of the startup in the country.

Besides India, CARS24 also has a presence in international markets. After starting its operations in India in 2015, CARS24 made its debut in foreign market through the UAE in 2020. After that, the startup entered other markets in a short span of time and currently has presence in Australia, Indonesia, and the Middle East. 

Besides, CARS24 also forayed into the lending space to provide vehicle financing through its NBFC CARS24 Financial Services in 2019, which further contributed to its topline. The startup claimed that its financial services business has disbursed loans worth INR 1,000 Cr till date.

On the other hand, IPO-bound Droom, a used-car and bikes marketplace which began operations in 2014, posted an operating revenue of INR 384.6 Cr in FY22. Sales jumped almost 207% during the year under review from INR 125.3 Cr in FY21. 

Like CARS24, Droom also has operations in Southeast Asia, the Middle East and Africa. 

Tiger Global-backed Spinny, which began operations in 2015, saw the biggest rise in operating revenue in terms of percentage in FY22. Its sales surged 334% to INR 109.4 Cr from INR 25.2 Cr in FY21. 

It must be highlighted that financing services offered by CARS24 and Droom are an additional revenue stream for them. While Spinny also launched Spinny Capital to offer financing services around the end of FY22, its cofunder and CEO Niraj Singh said in an interview that Spinny Capital would start contributing to the startup’s topline from FY23. 

Spinny currently claims to sell around 90,000 cars annually and operates in around 22 cities including Delhi, Gurugram, Noida, Bengaluru, Mumbai, Pune, and Hyderabad. 

How Financials Of CARS24, Spinny & Droom Stack Against Each Other

Spinny’s Expenses Soar 4X 

While CARS24 and Droom’s total expenses shot up over 2X year-on-year (YoY) in FY22, Spinny’s expenses jumped over 4X. 

CARS24’s expenses rose 110% to INR 6,256.3 Cr in FY22 from INR 2,967 Cr in FY21. At 79% purchase of pre-owned cars accounted for a major portion of the total expenses of the SoftBank-backed startup. 

While CARS24 purchases pre-owned cars, its rivals Spinny and Droom don’t. In FY22, CARS24 spent INR 4,623 Cr for purchasing pre-owned cars as against INR 2,945.1 Cr in the previous fiscal year.

It must be noted that earlier this year, CARS24 decided to stop buying pre-owned vehicles in over 80 cities in the country.  

Employee benefit expenditure was the second biggest expense for CARS24. The startup spent INR 548.4 Cr on employee benefit expenses in FY22, an increase of 153.8% from INR 216 Cr in FY21.

How Financials Of CARS24, Spinny & Droom Stack Against Each Other

It must also be highlighted that CARS24 laid off around 600 employees in FY22. 

Meanwhile, Droom’s expenditure rose 158% to INR 527 Cr from INR 204 Cr in FY21. Marketing and promotional expenses accounted for 77% of the total expenditure. The Sandeep Aggarwal-led startup spent INR 406.3 Cr on marketing and promotional expenses in FY22, a 228% increase from INR 23.7 Cr in FY21.

Droom spent INR 97 Cr on employee benefit expenses in FY22, a jump of 73% from INR 56.1 Cr in FY21.

Spinny’s total expenditure jumped 347% to INR 670 Cr in FY22 from INR 150 Cr the previous fiscal year. Like Droom, the rise in the total expenditure of Spinny was led by the jump in its promotional expenses. Spinny spent INR 220 Cr on marketing expenses in FY22, almost 2X of its operating revenue in the year. Meanwhile, employee benefit expenses rose 256% to INR 266 Cr during the year from INR 74.7 Cr in FY21.

Losses Across The Board

All three startups ended FY22 in the red. While CARS24 saw its net loss increase 29% to INR 248 Cr in FY22 from INR 192 Cr in FY21, Droom’s loss almost doubled to INR 137 Cr from INR 68.8 Cr in the previous fiscal year. At 345%, Spinny reported the biggest jump in loss in percentage terms. Spinny incurred a loss of INR 440 Cr in FY22, almost 54X of its operating revenue

How Financials Of CARS24, Spinny & Droom Stacks Against Each Other


While all the three startups have raised millions of dollars in funding, the ongoing funding winter has compelled them to proceed cautiously. While CARS24 shut operations in Indonesia and Saudi Arabia to focus on its core markets – India and Australia, Droom, which was eyeing raising INR 3,000 Cr through its initial public offering (IPO), has now shelved its IPO plans due to market uncertainty

Apart from these three startups, others in the space are also struggling with huge losses, which forced many of them to shut operations. For instance, Bhavish Aggarwal-led Ola shut operations of Ola Cars, its marketplace for pre-owned cars, within eight months of launch.

Last week, CarTrade said it would acquire OLX Auto’s India business for INR 537 Cr. Prosus has been trying to exit OLX Auto business across geographies since the beginning of this financial year to cut down its losses and turn profitable. 

Besides, Shark Tank India judge Amit Jain’s CarDekho earlier this year announced shutting its offline centres for sale of user cars. CarDekho reported a loss of INR 535 Cr in FY22. 

Given that investors are prioritising profitability amid the ongoing funding winter, the startups in the used-car segment need to double down on turning profitable to make the most of the opportunity in the space.

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