Carma Used Cars has priced its initial public offering at the top of its range, securing a $100 million raise at $2.70 a share for an implied market value of about $300 million.
The offer was upsized from an initial $70 million amid solid demand. E&P Capital and Canaccord are advising on the float, which will be one of the few new listings above $200 million to hit the ASX in 2025.
Founded in 2021 by former investment bankers Lachlan MacGregor (ex-UBS) and Yosuke Hall (ex-Goldman Sachs analyst), the Sydney-based online dealership buys used cars, reconditions them in-house and resells them. Management says Carma currently earns roughly $4,000 per vehicle on average and expects that margin to expand with scale, supporting a path to profitability.
Analysts say proceed with caution
Despite the bullish pricing, market sources caution the listing represents a sizeable bet: Carma remains loss-making on an EBITDA basis.
Backers see echoes of US peer Carvana, which listed in 2017 and at one point reached a US$42 billion market value. The comparison cuts both ways. Carvana’s pandemic-era surge—vehicle sales jumped as physical dealers were shuttered—gave way to a brutal comedown in 2022, including a 90% share price collapse and a 12% workforce reduction. The company reworked its balance sheet in 2023 via advisers Moelis and Jefferies, swapping debt to push out interest payments and stabilise liquidity.
Carma argues its focus on quality control and customer experience differentiates it from classified marketplaces such as Carsales.
The company highlights in-house inspection and reconditioning, warranties, a seven-day no-questions-asked returns policy, and a fully online checkout with instant finance approval—features designed to replicate and streamline the traditional dealership experience. Like established dealers, Carma also sees upside from add-on products such as finance and insurance.
Prior to launch, the company had targeted a $300–$400 million market value.
If execution matches expectations and margins widen, supporters say the business could transition to positive earnings, but note that scaling used-car logistics and inventory turns remains operationally intensive.
The float lands late in the 2025 calendar, with attention already turning to next year’s pipeline.
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