CarTrade’s Sobek shuts customer-to-business operations, shifts focus to classifieds business 

The Board of Directors of Sobek, a wholly owned subsidiary of CarTrade Tech Limited, has approved the closure of its customer-to-business (C2B) auto transaction operations and implementing cost cutting measures, the parent company said in a stock exchange filing.

Sobek Auto’s C2B transaction business struggled with its unit economics. The company aims to reduce both human resource and other administrative costs and to explore partnership opportunities with other players.

Sobek was acquired by online used-car marketplace CarTrade Tech Limited on August 11. During afternoon trading, CarTrade’s shares rose 2.3% to Rs 630.35 on the BSE on Wednesday.

Sobek has decided to shift its attention and resources to Olx, its profitable classifieds business. “The classified business (Olx.in, which includes both auto and non-auto verticals) of Sobek demonstrates profitability and substantial potential for future growth,” the company said in a statement.

Olx classifieds has garnered more than 100 million app downloads.The platform offers services across 12 categories including automobiles, real estate and electronics. It served as the classifieds unit of Dutch-listed investment firm Prosus until its acquisition by CarTrade.

On July 13, ET reported that Prosus had planned to sell Olx’s automotive business globally due to poor macroeconomic conditions and rising challenges in the segment. Prosus had been in talks with various players in the used car segment, including Cars24 and Spinny, before finalising the deal with CarTrade.

On July 12, CarTrade had acquired Olx’s entire India business for Rs 537.43 crore.

On August 10, ET reported that CarTrade recorded a 307% year-on-year surge in consolidated profit to Rs 13.51 crore in the June quarter of FY24. Its quarterly revenue for the same period rose 18% year on year to Rs 106.91 crore.

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