Rentomojo

IPO Size: Rs. 1,256 cr

• 12% of IPO is Fresh Issue of Rs. 150 cr (3.6% dilution) for (i) repaying Rs. 70 cr of Rs.188 cr gross debt (ii) lease payment till FY29E of Rs. 43 cr
• 88% is Offer for Sale (OFS) of Rs. 1,106 cr by 8 investors (61% combined holding to reduce to 36%) and promoter (22% to reduce to 20% post IPO)

Price band: Rs. 384-404 per share

M cap: Rs. 4,206 cr (IPO is 30% of m cap)

IPO Date: Wed 9^th Sep to Fri 11^th Sep 2026, Listing Thu 17^th Sep 2026

Grey Market Premium (GMP): We are strongly against ‘grey market premium’ as it is an unofficial figure, against SEBI guidelines.

 

Furniture and Appliance Rental Company

Rentomojo is a 14-year-old Bengaluru-based company providing home furniture and appliances on rental and subscription. It has omni-channel operations via a D2C (direct to consumer) website and 82 experience stores, catering to 2.5 lakh customers across 29 Indian cities. Company’s rental portfolio currently comprises 8.5 lakh items such as beds, mattresses, washing machines, refrigerators, wardrobes, sofas, televisions, water purifiers, earning average rent of Rs.6,250 per item per year i.e. Rs. 520 per month.

 

Profitable for Past 4 Years

Company’s profit before tax (PBT) has increased form Rs.4 cr in FY22 to Rs. 67 cr in FY26. In FY26, revenue grew 45% YoY to Rs.387 cr with EBITDA up 38% YoY to Rs. 155 cr, leading to 39% EBITDA margin.

Due to a consistent high occupancy rate of 80%+ (83% on FY26) and 50% repeat rate, financial matrix are healthy, such as 25% RoCE (despite capex heavy business) and 17% PBT margin on PBT of Rs. 67 cr. PAT margin remained elevated at 27% in FY26, due to deferred tax adjustment, leading to PAT of Rs. 104 cr and net margin of 27%. In the long term, net margins may sustain in mid-to-low teens.

 

Healthy Outlook

Fixed assets increased by nearly Rs. 175 cr or 60% YoY in FY26, providing healthy growth outlook. Its cash flow from operations grew 40% YoY in FY26 to Rs. 170 cr, which is quite healthy.

Company has many private labels (mix not disclosed) in its product list, which ensures high margins and return ratios.

 

Reasonable Pricing

M cap of Rs. 4,206 cr and Enterprise Value of Rs. 4,292 cr leads a historic EV/EBITDA multiple of 28x. Estimating 38% YoY growth to continue for FY27E, the current year EV/EBITDA multiple is 20x.

Net fixed assets stood at Rs. 426 cr, as of 31.3.26, implying business cash flows are sufficient for operations as to fund growth. Till date, company has raised just about Rs. 420 cr in past 11 years, implying judicious use of funds to build a growing profitable business.