Mahindra FirstChoice plans IPO in next 3 years

MUMBAI: Mahindra FirstChoice Wheels, the largest multi-brand pre-owned car company in the country and a subsidiary of Mahindra & Mahindra, today said it is likely to hit the capital markets in the next three-years.

"The initial public offer option is always there. Within the next two-three years, we may go in for an IPO," M&M president for HR, after markets & corporate services and member of the group executive board Rajeev Dubey said here.

According to Dubey, the company has set a target of selling 1,00,000 pre-owned cars by FY15 with a target revenue of Rs 2,500 crore at activity levels.

"Now we are present in 80 cities with 125 dealerships, including the franchisees. By the end of this fiscal, we plan to add another 75 dealerships and by next fiscal, another 100. We will take the total number of dealers to 500 by the end of FY15," Dubey said, adding the margin of the company varies from 8-10 per cent on an average.

Lst fiscal, the company sold 18,000 pre-owned cars which is roughly 10 per cent of the total organised pre-owned car market, he said, adding, "the organised sector will be about 10 per cent of the total used car market of 19-lakh cars sold last year."

Mahindra FirstChoice Service will also increase the number of its outlets to 500 by FY 15, he said, from the present 7-8 outlets. Mahindra FirstChoice Spares, which has almost 1,000 sales points, has contributed a revenue of Rs 800 crore at activity levels to the total activity revenue of Rs 1,270 crore, he said. By FY 15, the company expects Rs 6,500 crore revenue at activity levels from all the three companies, Dubey said.