Furniture and appliance rental startup Rentomojo has filed its Draft Red Herring Prospectus (DRHP) with the Securities and Exchange Board of India (SEBI), signalling its intent to go public. The company plans to raise ₹150 crore through a fresh issue of equity shares as part of its upcoming initial public offering (IPO).
The total IPO size is expected to be much larger, estimated in the range of ₹1,100 crore to ₹1,200 crore. In addition to the fresh issue, the offering will include an offer-for-sale (OFS), allowing existing investors to sell a portion of their holdings. This structure is commonly adopted by startups looking to raise capital while also providing partial exits to early backers.
Fund Utilisation and Growth Plans
Rentomojo is expected to utilise the fresh capital to strengthen its financial position and support expansion plans. The funds may be directed toward entering new cities, enhancing supply chain capabilities, and improving its technology platform to deliver a better customer experience.
The company operates on a subscription-based model, offering furniture, appliances, and electronics on rent, primarily targeting urban consumers. With increasing job mobility and changing lifestyle preferences, demand for flexible ownership solutions has grown steadily, benefiting players like Rentomojo.
Financial Momentum Ahead of IPO
The IPO plans come at a time when Rentomojo has shown improved financial performance. The company has recorded consistent revenue growth along with a notable rise in profitability in the last financial year. This marks a significant shift for a sector that has traditionally struggled with margins and high operational costs.
Improved unit economics and cost efficiencies have played a key role in this turnaround, strengthening the company’s position as it prepares to tap public markets.
A Key Moment for Rental Startups
Rentomojo’s public listing could be an important milestone for India’s rental economy. If successful, it may open doors for other subscription-based startups to consider IPOs as a viable growth path.
With a strong presence in major cities and a growing customer base, Rentomojo is well-placed to benefit from evolving consumer behaviour. As it moves forward with regulatory approvals, the IPO is expected to draw attention from investors looking to participate in India’s expanding digital and consumer-driven economy.