CarZ, a Hyderabad-based start-up company offering multi-brand auto solutions such as car repairs and servicing, plans to raise Rs 120 crore (approximately $25 million) by way of private equity (PE) investment by February 2013.
“We are currently under discussions with multiple PE investors from India as well as abroad, who have shown interest in us. We may raise the money from a single investor or multiple investors, but nothing has been finalised,” Venu Donepudi, co-founder and managing director of CarZ, said.
Currently, the company has 16 CarZ outlets across Andhra Pradesh, Karnataka and Kerala. “We plan to add another 34 with an investment of Rs 45 crore over the next two years across the southern and western Indian markets including Gujarat, Maharashtra and Tamil Nadu,” said Donepudi.
“Each of the 1,000-sq yard CarZ outlets requires an investment of about Rs 1.2 crore. So, part of the second-round funding will be used for setting expansion of these outlets and to have a pan-India presence,” he added.
CarZ, which commenced operations in February 2010 from Hyderabad, raised $5 million (Rs 22.5 crore) in series-A round funding from IndoUS Venture Partners this year. Multi-brand car servicing stations are catching up in India, as the after-market services networks for many of the auto needs of the customers. Currently, only one-third of the cars that are sold go back to the dealerships, post-warranty.
“The company targets to achieve Rs 20 crore turnover by the year-end. We have been growing at 400 per cent year-on-year, and we expect a similar growth to follow in the coming years,” said Donepudi. CarZ has also forayed into Kerala by opening its first outlet in Kochi, its 16th outlet in the country. “We plan to open six more outlets in Kerala over the next year,” he added.
