The Dutch multinational conglomerate Prosus NV is investing in its growing online car dealership business. This adds to the e-commerce business platform of the company, which extends across food delivery, educations, and payments.
As per Bloomberg news, Prosus NV, which is sitting on a pile of cash, will use some of its surplus funds to organically scale up the car business into a global auto business. CEO Bob Vaidik said in an interview that the auto unit has been seeing volumes grow. It has reached $1 billion in transactions with value-added services like financing and insurance apart from buying and selling.
The company has $5.5 billion cash to invest now after accounting for its acquisition of BillDesk, an Indian online payment service, and buyback obligations.
“The car business is in early stages. The company wants to build the business by investing in other countries, including India, Indonesia, and Eastern Europe. We need to add inspection centers for the used car business”, the CEO said.
The online car market grew during the pandemic when physical visits to the showroom slumped, and the new car availability was impacted by chip shortage. In the used car segment, Vroom Inc. doubled its business in the first half of 2021. In contrast, Carvana Co. registered sales of 200,272 cars during the same period, which was a record for the company.
Compared to sales of 39000 in the previous year, Prosus recorded sales of 69,000 for six months ending September in 2021.
Analysts this week valued the e-commerce portfolio of Prosus at around $ 50 billion, which excludes its stake in Tencent Holdings Ltd, a Chines Tech giant. According to the market, the value of these companies is next to nothing, and the investment group wants to change the perception.
