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Tiger-backed NestAway acquired by Aurum at 95% valuation reduction

The home rental startup NestAway Technologies, backed by Tiger Global, is about to be acquired by Aurum PropTech (formerly Majesco Ltd) for Rs 90 crore ($11 million).

According to documents filed with the National Stock Exchange (NSE), the board members of Aurum approved the purchase of up to 100% of the shares of NestAway Technologies Pvt Ltd for a cash consideration of up to Rs 90 crore.

Notably, a 95% valuation reduction of NestAway was used to approve the acquisition.

In 2019, the startup had a $220 million valuation. With the support of well-known investors like Tiger Global, Flipkart, and others, NestAway had amassed a total funding of $110 million.

According to Aurum’s NSE filings, this acquisition will expand its consumer-tech business and is consistent with its strategy to establish an “integrated proptech ecosystem.” Depending on the fulfillment of a few requirements, the transaction is anticipated to close on or before June 30, 2023.

In June 2022, Aurum PropTech acquired Helloworld, a NestAway project that offers dorm-style housing to college students. Within a year, Aurum expanded its Helloworld operations successfully, opening the door for the purchase of NestAway.

NestAway is a technology platform for the real estate market that was established in 2015. It facilitates rental transactions as well as various services and processes related to them.

It makes use of technology and data to simplify tasks like scheduling visits, paying rent, and making service requests.

Presently, NestAway has 18,000 properties available on its platform, generates an annualized revenue of Rs 30 crore, and regularly receives 600,000 visits. It faces competition from companies like Stanza Living and ZoloStays.

Following NestAway’s struggle to increase revenues and reduce losses since FY20, a significant valuation reduction has been made. The company’s operating revenue decreased 47% to Rs 57.87 crore in FY22 from Rs 108.9 crore in FY20. The company lost Rs 94.97 crore in FY22, according to a media house analysis.

For every rupee of operating income in FY22, NestAway had to spend Rs 3.08.

The scale of Aurum Proptech, on the other hand, increased by 8X to Rs 126.87 crore in FY23 from Rs 15.8 crore in FY22, while its losses increased to Rs 40.3 crore in FY23. On a quarterly basis, its revenue from operations increased 17.6% to Rs. 45.36 crore in Q4 of FY23 while losses decreased 10% to Rs. 9.83 crore.




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