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Rentomojo has filed draft papers with SEBI to raise INR 150 crore through a fresh issue, along with an offer for sale by existing investors. The company plans to use the proceeds mainly for debt repayment, warehouse-related expenses, and general corporate needs. It operates in 22 cities with a large subscriber base and holds a strong share in the organised rental market. The IPO also allows early investors to partially exit. The company has shown steady revenue growth and improved profitability ahead of its planned listing.
Rentomojo Ltd, a furniture and appliance rental platform, has filed its draft red herring prospectus with the Securities and Exchange Board of India (SEBI) for an initial public offering. The issue consists of a fresh equity raise of up to INR 150 crore and an offer for sale of about 2.84 crore shares by existing investors. Advertisement
The company has stated that the funds from the fresh issue will be used mainly for repayment or prepayment of borrowings. A part of the proceeds will also go towards lease rentals and licence fees for warehouses and experience centres, along with general corporate purposes. This indicates a focus on improving its balance sheet while supporting operational infrastructure.
Founded by Geetansh Bamania, Rentomojo operates a technology-led platform that allows users to rent furniture, appliances and other household items on a subscription basis. The company has built a strong position in the organised rental segment over the years and continues to expand its presence in urban markets.
As per the draft papers, Rentomojo holds an estimated 42-47 percent market share in the organised online rental segment based on subscription revenue for FY25. The company currently operates in 22 cities and manages a network of 21 warehouses. It also has a subscriber base of over 2.27 lakh active users, showing consistent demand for rental-based consumption.
The business follows an omni-channel model, combining its online platform with physical experience centres. This helps customers view products before renting while also managing subscriptions digitally. The model supports better customer retention and improves utilisation of assets across locations.
On the financial side, the company reported revenue from operations of around INR 265.96 crore for FY25, along with a profit after tax of INR 43.11 crore. For the six-month period ending September 2025, revenue stood at about INR 176.61 crore. The company had also seen a strong improvement in profitability in the past year, nearly doubling its net profit compared to the previous year, supported by revenue growth and cost control.
The offer for sale component includes participation from existing investors such as Accel, Chiratae Ventures and Edelweiss, who will partially dilute their stakes. The IPO will provide them an opportunity to exit or reduce holdings after supporting the company through its growth phase.
In preparation for the public listing, the company had taken several steps over the past year, including internal restructuring and strengthening governance practices. It has also appointed Motilal Oswal Investment Advisors, Axis Capital and IIFL Capital Services as the book-running lead managers for the issue. Further details such as price band and listing timeline are expected after regulatory approvals.
Source PTI
FAQ
1. What is Rentomojo planning with its IPO?
Rentomojo has filed draft papers with SEBI to raise around INR 150 crore through a fresh issue of shares, along with an offer for sale by existing investors. This IPO is aimed at strengthening its financial position and supporting future growth, while also giving early investors an opportunity to partially exit.
2. How will the company use the funds raised from the IPO?
The company plans to use a major portion of the funds for repayment or prepayment of its existing borrowings. Apart from that, some amount will go towards warehouse lease rentals, licence fees, and general corporate purposes. This shows a focus on improving its balance sheet while continuing to invest in operational infrastructure.
3. What does Rentomojo's business model look like?
Rentomojo operates a rental platform where users can subscribe to furniture, appliances, and other household items instead of buying them outright. It follows an omni-channel approach, combining its online platform with physical experience centres, allowing customers to view products offline while managing rentals digitally.
4. How strong is Rentomojo's market position?
The company holds a significant share in the organised online rental segment, estimated at around 42-47% based on subscription revenue. It operates across 22 cities, with a network of warehouses and a growing subscriber base of over 2.27 lakh users, indicating steady demand for rental-based living solutions.
5. What do the company's financials indicate before the IPO?
Rentomojo has shown consistent growth, reporting revenue of around INR 265.96 crore for FY25 along with a profit after tax of INR 43.11 crore. It has also improved profitability compared to the previous year, supported by better cost control and rising demand, which strengthens its position ahead of listing.
6. Who are the existing investors selling their stakes?
The offer for sale includes participation from investors like Accel, Chiratae Ventures, and Edelweiss. These investors will partially dilute their holdings, which is a common move during IPOs as early backers look to realise returns after supporting the company's growth.
7. What does this IPO mean for the rental housing and lifestyle market?
This move highlights the growing acceptance of rental and subscription-based consumption, especially in urban areas. With more people preferring flexibility over ownership, platforms like Rentomojo are gaining traction, and the IPO reflects increasing investor confidence in this segment.
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