Rentomojo, India's largest online furniture and appliance rental platform, has filed its Draft Red Herring Prospectus (DRHP) for a fresh issue of ₹112.50 crore. The company reported a robust financial performance in FY2026, with revenue from operations reaching ₹386.99 crore and a profit after tax (PAT) of ₹104.30 crore.

About the Company

Founded in 2012 and headquartered in Bangalore, Rentomojo operates as a technology-driven, full-stack direct-to-consumer (D2C) rental and subscription platform. As of March 31, 2026, the company served 253,825 live subscribers across 29 cities. It holds an estimated 42%–47% market share in subscription revenue for the fiscal year 2025 and commands a 50%–55% share of live subscribers in the home furniture and appliances rental market. The business model integrates category management, procurement, refurbishment, servicing, and reverse logistics, supported by proprietary technologies like Mojodesk for ticketing and MojoVaahan for routing.

Financial Performance

Rentomojo has demonstrated consistent profitability over the last three fiscal years. Revenue from operations grew at a CAGR of 41.71% from FY2024 to FY2026. Total assets increased to ₹641.12 crore in FY2026, while total equity stood at ₹295.81 crore.

Operating cash flows grew significantly to ₹172.87 crore in FY2026. However, the company reported a negative working capital of ₹91.17 crore and a current ratio of 0.55x as of March 31, 2026.

Why the Company Is Raising Funds

The proceeds from the fresh issue of ₹112.50 crore are intended for specific corporate purposes:

• Debt Repayment: ₹70.00 crore will be used to repay or prepay outstanding borrowings and accrued interest.
• Lease Payments: ₹42.50 crore is allocated for payment of lease rentals and license fees for warehouses and experience stores.
• General Corporate Purposes: The balance amount will fund operating expenses, transportation, employee costs, marketing, and organic or inorganic growth opportunities.

Business Strengths

Rentomojo highlights several key strengths in its filing:

• Consistent Profitability: One of the few Indian D2C product commerce brands to show consistent profitability over three fiscals.
• Market Leadership: Largest online rental platform by live subscribers and subscription revenue.
• Scalable Asset Model: Proven cohort returns, with the FY2017 cohort generating a 5.12x revenue multiple on original asset cost.
• Proprietary Technology: Unique tech stack including Mojodesk and MojoVaahan enhances operational efficiency and creates barriers to entry.
• Strong Institutional Backing: Supported by investors such as Accel India IV (20.92%), Edelweiss Discovery Fund (10.53%), and ValueQuest S.C.A.L.E. Fund (8.92%).

Key Risks

The DRHP outlines material risks that could impact the business:

• Revenue Concentration: 97.90% of revenue comes from furniture and appliance rentals, and 89.51% is derived from the top 10 cities.
• Liquidity Constraints: Negative working capital of ₹91.17 crore and a low current ratio of 0.55x indicate potential short-term liquidity pressures.
• Debt Obligations: Outstanding borrowings stood at ₹258.33 crore as of June 30, 2026, with past instances of payment delays.
• Operational Incidents: A fire at the Noida warehouse in June 2026 resulted in losses of ₹11.02 crore.
• Legal Proceedings: The company faces 16 legal proceedings, including a petition seeking to block the IPO.
• Occupancy Trends: Occupancy rates declined from 86.43% in FY2024 to 83.34% in FY2026.

Important IPO Dates

The IPO is scheduled to open on September 9, 2026, and close on September 11, 2026. Allotment is expected on September 15, 2026, with listing scheduled for September 17, 2026.

Offer Details

The offer consists entirely of a fresh issue with no offer for sale (OFS). The minimum fresh issue size is ₹112.50 crore. Price band and lot size details are not yet available in the filing.

Bottom Line

Rentomojo presents a growth story with strong market leadership and consistent profitability, reporting ₹386.99 crore in FY2026 revenue. The ₹112.50 crore fresh issue aims to reduce debt and support operations. Investors should note the high revenue concentration, negative working capital, and ongoing legal proceedings as key risk factors.

Rentomojo is seeing steady adoption of bed and mattress rentals across Gurgaon, Noida, and Pune in 2026. The platform lists queen frames from ₹244 a month, targeting renters who prefer subscription models over ownership for short-term tenures.

Rental Economics vs. Purchase

The financial logic for renting is driven by the high upfront cost of furniture relative to short stay durations. A comparable bed frame costs between ₹18,000 and ₹40,000 to purchase. When factoring in a resale value of ₹7,000 to ₹9,000, the net cost of ownership over twelve months ranges from ₹9,000 to ₹11,000. In contrast, renting a queen frame in Gurgaon totals ₹4,068 over the same period.

Mattresses present a distinct challenge for buyers due to hygiene concerns that render used items nearly unsellable. Rentomojo addresses this with monthly plans starting at ₹175 for a 4-inch foam mattress in Pune. Options include foam, latex, coir, and orthopaedic varieties.

Operational Model

The service includes free assembly within 48 to 72 hours, free repairs, annual maintenance, and relocation within or outside each city. Tenures range from three to 36 months. Booking requires standard KYC and a refundable deposit, with postpaid billing.

Demand is concentrated among first-time job holders, couples, and shared apartment groups. These users prioritize having a functional bedroom within two to three days of moving in.

Market Position

Rentomojo has operated in this category since 2014. According to its draft red herring prospectus filed on March 27, 2026, and citing the Redseer Report, the company is India’s largest tech-driven full-stack D2C online rental platform by FY25 subscription revenue and live subscribers. It supports this scale with an in-house team of 1,688 technicians, carpenters, and painters.