Carsome Group has come out with a statement to clarify on media reports suggesting that they have asked the Ministry of Finance (MOF) for more funding.
In a statement, Carsome said that they submitted a letter on 27 March 2023 in response to an engagement session with the Finance Ministry to encourage and welcome the participation of Malaysian institutional investors in the company’s growth journey.
Carsome said that they frequently engage in discussions with various stakeholders on ecosystem building and driving institutional engagements and mentioned that they have always championed growth for the local start-up ecosystem which can positively contribute to the nation’s economy and enhance the nation’s digital talent pool.
It was reported that the company allegedly sought help from MOF and they were looking at listing their shares with an initial public offering (IPO) to get more funding.
Carsome said that the group is still financially healthy, saying that its liquidity position is at USD150 million (RM692 million), which offers the company sufficient runway beyond its break-even point, which they expect to achieve well ahead of its targeted deadline.
In terms of market share, Carsome said that they have been growing wherever they operate, adding that they are one of the last few large players in the used car e-commerce space in Southeast Asia.
This is in contrast to their peers and competitors, they said, which are reported to be exiting prime growth markets like Indonesia and Thailand while other peers are pivoting into capital-intensive financing operations.
Today, the group is looking out for new opportunities in markets across Malaysia, Indonesia, Thailand, and Singapore with a pipeline of growth initiatives across its ecosystem and they added that they welcome broader institutional support.
Carsome continued saying that it was among the first regional start-ups to commit to an accelerated profitability plan to prepare the group for more disruptions and challenges in the funding markets.
This approach has borne fruit, according to the company, which said that they have been delivering operational profitability as a group whilst enabling the company to beat internal targets as of the first quarter of this year.
Carsome’s Co-founder and Group CEO Eric Cheng said that they have embraced adaptability and remained resilient.
Through our commitment to operational excellence and our customer-centric approach, we are grateful to have exceeded our expectations, achieving notable growth whilst pursuing profitability. We are grateful for the Government’s support towards a homegrown brand such as ours as we scale regionally.
Eric added that the group’s internal measures for operational excellence, driven by strong capabilities in data and technology, continue to yield gross margin improvements, team productivity, marketing efficiencies, and inventory management across its markets.
Coupled with this, Carsome will take full advantage of its ecosystem strategy to redefine customer satisfaction in automotive ownership to serve its growing customer base and communities across Southeast Asia.
Carsome’s focus remains on solving the pain points in high stake, high-complexity transactions and providing the ultimate customer experience in automotive ownership.
Healthy 2022 for Carsome
In 2022, the Group said they grew 250% in revenue, with the newly established retail line “Carsome Certified” contributing 35% of total revenue.
In the first quarter of this year, they achieved their operational profitability milestone for the first time, primarily driven by a significant growth of trade margin, which doubled compared to the same period last year.
They noted that more than 80% of the trade margin came from high-quality transaction margins, far ahead of most of its global peers.
Among the highlights of its ecosystem strategy, iCar Asia Group has delivered a 30% year-on-year revenue growth in Q1 2023.
They bought over 80.1% stake in iCar Asia from the Catcha Group and other shareholders of iCar Asia back in 2022, becoming the sole shareholder.
In addition to achieving profitability on its own, the ecosystem strategy has also contributed significantly to the more than 60% reduction in Customer Acquisition Cost of the Group over the last twelve months.
With the launch of the flagship CARSOME Service Centres, the Group has meaningfully integrated its products and services, from discovery to servicing, all within a single consumer app.
Carsome
According to them, this marks a major step in pursuing their mission: to provide its customers with peace of mind through the entire lifecycle of their ownership experience.
