In a first after Budget 2020, CarDekho announces ESOP sale worth $3.2 mn for its employees

• CarDekho has offered its employees the option to sell their stock in the company.
• Eligible employees will be able to cash out 50% of their vested options.
• This is the first ESOP sale program after the Budget 2020 announcement.

Indian car marketplace startup CarDekho has offered its employees the option to sell their stock in the company. It became the first startup to take advantage of the tax benefits that Budget 2020 has announced.

In the Budget, Finance Minister Nirmala Sitharaman gave a five-year tax holiday on ESOPS. ESOPs will now be taxable when the employee sells the shares or exits the company or five years after the shares were exercised, whichever is the earliest.

The cash out is estimated to be worth $3.5 million and as many as 100 employees will be eligible for it. The company allowed its employees to sell ESOPs first in April 2019.

CarDekho said that eligible employees will be able to cash out 50% of their vested options under Girnarsoft group’s (the parent company of CarDekho) ESOP Exercise and Secondary Sale Plan.

The eligible employees are the ones who have been with the company for over two years and former employees, who have served four years in the company.

In December 2019, CarDekho raised $70 million in series D funding from China’s Global Voyager Fund. The Global Voyager Fund is the investment arm of China’s largest insurer Ping An.

The round also saw participation from Sunley House Capital Management, a subsidiary of global private equity firm Advent International and CarDekho’s existing investors Sequoia India and Hillhouse Capital.

CarDekho claims to have directly influenced 42% of the retail sales in India as it works with 4,000 auto dealerships and 3,000 used car dealers.

Meanwhile, the overall revenue of the company grew by 92% over the first half of the last fiscal year to $28 million.

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