CarTrade Tech shares: Nomura retains ‘Buy’, Rs 3,340 target on multiple growth levers

As per the latest business developments, Nomura has maintained its 'Buy' rating and Rs 3,340 target price on CarTrade Tech after an market observer conference call, highlighting "multiple expansion levers, with scope for further margin expansion".

Management keeps focus on scaling CarTrade's used-car ecosystem while expanding OLX beyond auto classifieds. Used-car listings at present stand at 3.4 million+, with management expecting them to reach ~10 million over the medium term.

On OLX, the elite buyer programme for businesses has been rolled out and has generated "substantial engagement". The firm additionally plans to start commerce for its non-auto used-products business, providing escrow and logistics services initially through third-party partners. This "could add new monetisation streams as volumes scale", Nomura stated.

Another key opportunity is VAYA AI, which uses CarTrade's proprietary, first-party data across CarWale, BikeWale and other platforms to generate insights into consumer behaviour, including vehicle consideration, cross-shopping, variant preferences and trends across SUVs, EVs, ADAS and other features.

The Auto Behaviour Index is likely to go live over the upcoming weeks, with management evaluating a subscription-led monetisation model.

The Landmark Cars partnership "further strengthens CarTrade's online-to-offline used-car proposition" by providing real-time inventory visibility. Management highlighted firm online used-car discovery and continued consumer demand for test drives, supporting the integration of digital discovery with physical retail. The topline-share model is in line with Spinny.

Nomura stated the firm reach of OLX – 32 million MAUs, 3 million+ sellers and 5-6 million buyers – and "limited monetisation to date" provides potential for topline to "at least double from FY26 marks assuming a modest 5% adoption".

"Success of new initiatives of the Elite buyer program, partnerships with Landmark, Spinny and more dealers; AI-led new products like the Auto Index that tracks consumer behaviour adds additional expansion levers to the firm," Nomura stated.

"Given the asset-light nature of the business, this can keep expand margins further," the brokerage stated. Its estimates are largely unchanged, with an anticipated ~30% EBITDA CAGR over FY26-29F.

Nomura maintains its target EV/EBITDA at 32x for Consumer/OLX and 25x for SAMIL, arriving at a TP of Rs 3,340.