GoMechanic eyeing threefold growth to Rs 700 cr by 2027 before IPO launch

Car services and repair platform GoMechanic expects over three-fold rise in net revenue to Rs 700 crore by 2027 and thereafter go for public listing, a top official of the company said.

GoMechanic Co-Founder and CEO Himanshu Arora told PTI that the company at present has around 3 per cent market share and aims to raise it to 10 per cent in the next three years.

The company is also looking to diversify offerings, foraying into the two-wheeler and electric vehicle services segment.

"We sit at about 3 per cent of the market share right now and to be servicing every 1 car out of ten would be around 10 per cent by 2027. By 2027, we expect our brand to generate approximately Rs 700 crore in revenue. We believe that an IPO is a natural next step for GoMechanic's growth story," Arora said.

The company at present provides services through 800 garages across 125 cities and plans to scale up to 2,500 garages across 500 cities by 2027.

GoMechanic was acquired by Servizzy, a subsidiary of the Lifelong Group, in March 2023 after anomalies in its financial records were found under previous management and the firm was put on sale by the investors.

"It has been only about 20 months since we acquired the brand... the trajectory clearly indicates that an IPO is on our roadmap," Arora said.

GoMechanic posted a revenue of Rs 210 crore in the financial year 2023-24 and a revenue of Rs 85 crore in the April-June 2024 quarter.

"Our spares and accessories are also growing fast. We should be clocking about Rs 432 crore this financial year in gross merchandise value and roughly around Rs 200 crore in the net revenue," Arora said.

"When we acquired the brand, the customer retention rate was 33 per cent and at present it is 53 per cent. We are operating on a franchisee model where we connect with garages and deploy our own personnel for quality control. Our target is to reach 65-66 per cent retention rate by 2026," GoMechanic Co-Founder and Chief Operating Officer Muskaan Kakkar said.

She said that GoMechanic has 8 lakh active users per month, which is now gradually getting close to 10 lakh.

"We are EBIDTA positive (operational profit). For me, maintaining PAT (profit after tax) positivity in our main operations is essential for our financial stability. At the same time, strategic investments in areas like two-wheelers are necessary for our growth. While these investments may affect our PAT in the short term, they are crucial for long-term success.

We will definitely be PAT-positive by 2027," Kakkar said.

She said that GoMechanic at present has around 550 people on payroll and beyond this entire franchise network comprises about 4,000 individuals working on the ground.

"Currently, we are in the process of hiring the head of our two-wheeler business. We are looking for someone who has experience in building businesses from the ground up, not necessarily limited to the automobile sector. Our goal is to bring in individuals who have successfully launched and scaled businesses, ensuring they grow with us and contribute significantly to our expansion," Kakkar said.