CarTrade Tech share price gains 4% in overall weak market; here's why

CarTrade Tech share price rose nearly 4% on Wednesday's trading session following the decision by Sobek Auto India Pvt Ltd, the company's wholly owned subsidiary, to discontinue its own C2B operations of the auto transaction business. CarTrade Tech share price today opened at intraday low of ₹619.20 apiece on BSE. CarTrade Tech stock price touched intraday high at ₹640.70. At 13:49 IST, CarTrade Tech shares were trading at ₹630.35, 2.30% higher.

The board of directors of Sobek Auto India decided to close the unit in light of the economic challenges that the company was facing, the CarTrade Tech said in an exchange filing. Sobek intends to further expand its Classified division (Olx.in, covering both automotive and non-auto verticals.

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"The Board of Directors of Sobek at their meeting held today i.e. on October 25, 2023 have decided to shut down their own C2B operations and reduce human resource and other administrative cost of the said business and explore partnerships with other players for the same," company said in an exchange filing.

Also Read: CarTrade open to more acquisitions in auto, autotech

On July 10, CarTrade Tech had announced that it had entered into a share purchase agreement with Sobek Auto India Private Limited and its holding company OLX India BV for the acquisition of a 100% stake in Sobek from OLX India BV for a cost of ₹537.43.

Sobek's Classified business (Olx.in), which includes both car and non-auto verticals, exhibits profitability and significant growth potential going forward. In light of the classified industry's enormous potential for long-term growth and wealth generation, Sobek has decided to focus its efforts and resources there.

With more than 100 million app downloads under its belt, OLX Classifieds is a major force in the Indian classifieds market. According to the filing, it provides a broad range of services in 12 different categories, including real estate, technology, cars, and more.

Also Read: CarTrade share price jumps 6% as analysts see potential for value creation in Sobek acquisition

As per trendlyne data, CarTrade Tech stock price rose 4.12% and underperformed its sector by 11.56% in the past year. 

According to Rajesh Bhosale - Equity Technical and Derivative Analyst, Angel One, CarTrade Tech stock price are showing strength and are up around 3% in the bleak market conditions. 

Technically, as well prices are in higher top higher bottom price cycle and recent price correction have been along with broader market weakness. 610 - 600 seems to be a strong support zone whereas 680 - 690 resistance zone.

Disclaimer: The views and recommendations given in this article are those of individual analysts. These do not represent the views of Mint. We advise investors to check with certified experts before taking any investment decisions.