₹1,255.57-crore public issue opens for subscription; brokerages SBI Securities and Ventura recommend subscribing, citing market leadership, recurring revenue and improving profitability

The initial public offering (IPO) of Rentomojo, one of India’s leading organised furniture and appliance rental platforms, opened for subscription on Wednesday, September 9, and will remain available until September 11. The ₹1,255.57-crore issue has attracted positive views from analysts, who believe the company is well positioned to benefit from the country’s rapidly expanding rental economy.

The IPO has been assigned a bullish outlook by brokerages, supported by Rentomojo’s strong market position, growing subscriber base, recurring rental revenue model and improving financial performance. However, analysts have also highlighted risks related to asset utilisation, customer defaults, competition and the capital-intensive nature of the business.

Rentomojo IPO structure and key details

The public issue is a book-built offering comprising both a fresh issue and an offer for sale.

• Total issue size: ₹1,255.57 crore

• Fresh issue: 37.15 lakh shares aggregating to ₹150 crore

• Offer for sale: 2.74 crore shares aggregating to ₹1,105.57 crore

• Price band: ₹384–₹404 per share

• Lot size: 37 shares

• Minimum investment at upper price band: ₹14,948

• Issue opening date: September 9, 2026

• Issue closing date: September 11, 2026

• Book-running lead manager: Motilal Oswal Investment Advisors

• Registrar: Kfin Technologies

At the upper price band of ₹404 per share, the minimum application for one lot would require an investment of ₹14,948, excluding applicable charges.

Strong market position supports investor interest

Rentomojo is the largest player in India’s organised home furniture and appliance rental market, excluding water purifiers. According to the company’s issue-related disclosures cited by analysts, it held an estimated 42–47 per cent share of subscription revenue in FY25.

The company’s position is further supported by its large subscriber base. SBI Securities noted that Rentomojo accounted for approximately 50–55 per cent of live subscribers in the organised rental market as of March 25.

This scale provides the company with advantages in customer acquisition, brand visibility, supplier relationships and asset utilisation. Its established platform also allows it to serve customers across multiple categories, including furniture, appliances and lifestyle products.

Recurring revenue and repeat orders strengthen business model

Rentomojo operates through a subscription-based rental model, allowing customers to access furniture, appliances and other lifestyle products without making large upfront purchases.

The platform primarily targets young professionals, students, corporate customers and urban households that prefer flexibility over ownership. This model is gaining traction as consumers increasingly prioritise convenience, affordability and the ability to upgrade products without bearing the full cost of ownership.

SBI Securities highlighted that organic traffic contributed 61 per cent of Rentomojo’s website traffic in FY26. Repeat orders also increased to 50 per cent of total orders in FY26, compared with 47 per cent in FY24.

The rise in repeat orders indicates stronger customer engagement and may help the company reduce dependence on paid customer acquisition. Higher organic traffic and repeat business can also improve marketing efficiency and support operating profitability over time.

Revenue doubles in two years

Rentomojo has reported strong revenue growth in recent years. According to Ventura, the company’s revenue increased from ₹196 crore in FY24 to ₹387 crore in FY26.

The growth reflects rising demand for subscription-based consumption, expansion into new customer segments and increasing adoption of rental solutions in urban markets.

The company manages the complete rental lifecycle, including product sourcing, refurbishment, delivery, installation, maintenance and customer servicing. This integrated operating model allows Rentomojo to control the customer experience while improving the productive life of its rental assets.

Analysts believe that the company’s ability to refurbish and redeploy assets can help improve asset utilisation and support margins, provided that demand remains strong and service quality is maintained.

Rental economy expected to benefit from urbanisation

The Indian rental economy is being supported by several structural trends. Rapid urbanisation, migration for employment and education, rising housing costs and changing consumer preferences are encouraging more people to rent rather than purchase household products.

Unfurnished rental homes represent a significant opportunity for organised rental platforms. Tenants can furnish their homes without committing substantial capital, while young consumers can access premium products through manageable monthly payments.

The rental model is also relevant for customers who frequently relocate for work or education. For corporate clients, rented furniture and appliances can provide a flexible solution for employee accommodation and temporary housing requirements.

Ventura believes these trends create a favourable environment for Rentomojo’s long-term growth.

SBI Securities assigns ‘Subscribe’ rating

SBI Securities has recommended subscribing to the Rentomojo IPO, citing the company’s market leadership, strong growth, improving profitability and favourable industry outlook.

The brokerage noted that Rentomojo benefits from rising urban mobility, a large share of unfurnished rental housing and increasing preference for flexible, asset-light consumption.

At the upper price band of ₹404, Rentomojo is valued at a post-issue price-to-earnings multiple of 39.4 times based on FY26 earnings.

SBI Securities acknowledged that the valuation is not inexpensive but believes the premium is supported by the company’s leadership position, recurring revenue model and growth prospects.

The brokerage has also identified several risks, including the capital-intensive nature of the business, subscriber defaults, rental demand fluctuations, geographic concentration and execution challenges related to asset utilisation and service quality.

Ventura also recommends subscribing

Ventura has assigned a ‘Subscribe’ rating to the IPO, highlighting Rentomojo’s participation in the growing rental economy and its technology-led operating model.

The brokerage pointed to the company’s recognised brand, recurring rental income and integrated rental lifecycle management as key strengths.

However, Ventura also cautioned that the business remains exposed to asset depreciation, customer acquisition costs, competition, logistics efficiency and asset utilisation.

Since Rentomojo owns or controls a significant inventory of rental products, the company must continuously balance asset purchases with demand. Weak utilisation or extended periods between rentals could affect returns on capital and profitability.

Grey market premium signals positive listing expectations

The company’s grey market premium (GMP) was reportedly indicating a potential listing gain of around 33.17 per cent, implying an estimated listing price of approximately ₹538 against the upper issue price of ₹404.

However, GMP is an unofficial indicator and is not regulated by stock exchanges or market authorities. It can change sharply depending on market sentiment, subscription levels and broader market conditions. Investors should therefore avoid relying solely on grey market trends while evaluating the IPO.

Key risks investors should consider

Despite its growth potential, Rentomojo’s business model carries several risks.

Capital-intensive operations

The company must invest in furniture, appliances and other rental assets to expand its subscriber base. This creates a continuous requirement for capital expenditure and working capital.

Asset utilisation

Profitability depends significantly on how efficiently rental assets are deployed. Low utilisation, prolonged idle periods or damage to products could reduce returns.

Customer defaults

Delayed payments, cancellations and customer defaults may affect cash flows and increase recovery or refurbishment costs.

Competition

The organised rental market remains competitive, with established players and smaller regional operators competing on pricing, product availability, delivery and service quality.

Logistics and servicing

Delivery, installation, maintenance and refurbishment are critical to customer satisfaction. Any operational inefficiency could increase costs and affect repeat business.

Valuation

At a post-issue P/E of 39.4 times based on FY26 earnings, the IPO carries a relatively demanding valuation. Sustaining the premium would require continued revenue growth and improvement in profitability.

Investor perspective

Rentomojo offers investors exposure to India’s emerging rental economy, which is being driven by urbanisation, flexible lifestyles and a growing preference for subscription-based consumption.

The company’s market leadership, rising repeat orders, strong revenue growth and established operational platform are important positives. Its integrated rental lifecycle also provides an opportunity to improve asset utilisation and customer retention.

At the same time, investors should closely monitor cash generation, asset turnover, depreciation, customer acquisition costs and the company’s ability to maintain profitability while expanding.

With both SBI Securities and Ventura recommending a subscription, the IPO has received encouraging analyst support. Nevertheless, investors should evaluate the issue based on their risk appetite, investment horizon and understanding of the capital-intensive rental business rather than relying only on expected listing gains.