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Mahindra First Choice Services, a leading multi-brand car service chain, is proposing to raise about ₹125 crore to fuel its growth plans.
The company is looking to raise the money through financial or strategic investors. It has just commenced the process and the sum is likely to be raised in the next 2-3 quarters.
“We will be investing one- third of the money we plan to raise in marketing and brand awareness exercises. One- third will be invested in technology — digital solutions — and the remaining will be earmarked for operations, working capital and to accelerate business expansion,” YVS Vijaya Kumar, Chief Executive Officer, Mahindra First Choice Services, told BusinessLine here.
Multi-pronged strategy
The company, which is part of the Mahindra Group, is working on a multi-pronged strategy to grow and retain its dominance in the automotive after-market space in the country.
“We think only a hybrid model — a combination of physical presence and digital — will work in this space,” he said. On the physical side, it has established a strong spare parts and service network.
In spare parts, it has differentiated itself from the competition by way of private labels with strong sourcing tie-ups.
Also, it has the largest service network with 330 car workshops in more than 250 towns across the country.
It plans to increase the number of workshops to 1,000 in the next three years.
Garage management
On the digital side, it has already built the platform under which service can be delivered to customers at any authorised garage.
It will invest significantly in this space going forward.
With unique features, its garage management software is being used by several independent workshops. Now the company is also in the process of integrating spare parts management with its other platforms. All these initiatives form part of its digital focus.
Discussing the company’s growth prospects, Vijaya Kumar said the company suffered a setback during the GST implementation period last year.
However, with the recovery of the market in the next 2-3 months, the company is hopeful of recording 50 per cent growth in its revenue this fiscal.
It posted revenue of ₹91 crore last year.
The company’s revenue comes from franchisee fees and spare parts sales as of now.
But, new business solutions and entry into more vehicle segments are expected to fetch higher revenues in the coming years.
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