Citykart secures Rs 538 crore funds to expand presence across India

27 May, Mumbai 2025

Value fashion retailer Citykart secured Rs 538 crore in a new funding round that included both new investments and secondary share sales. Attended by TPG NewQuest and A91 Partners, the funded round is expected to have valued the company at around Rs 1,400 crore.

Of the total funds, Rs 120 crore is fresh capital and would be used to expand Citykart’s presence beyond its core Tier II & III cities in Uttar Pradesh and Bihar, as per Sudhansu Agarwal, Founder and Managing Director, Citykart.

Currently operating 137 stores, Citykart plans to open 40-50 new outlets annually across states like Rajasthan, Assam, Odisha, and Jharkhand. The company competes with publicly traded retailers such as VMart, Vishal Mega Mart, and Style Baazar.

The Gurgaon-based company has seen its revenues grow by about 70 per cent over the past two fiscal years, reaching over Rs 900 crore in FY 2024. Agarwal expects these to exceed Rs 1,300 crore in the current fiscal year.

A major alternative asset manager from the Middle East, Bahrain-based Investcorp achieved a fourfold return on its 2019 investment in Citykart. Investcorp had acquired Citykart's stake after it took over IDFC Alternatives' private equity and real estate investment funds in 2019; originally, IDFC Alternatives and India SME Investments had jointly invested Rs 100 crore in Citykart.

Following this latest funding round, secondaries-focused PE fund TPG NewQuest has become Citykart's largest institutional investor, followed by Mumbai-based investment firm A91 Partners and India SME. A former executive at value retailer Vishal Mega Mart, Agarwal and his family maintain a controlling 55 per cent-56 per cent stake in the company.

Currently, Citykart is experimenting with new store formats in rural areas of Delhi and Gurgaon, where the customer base is similar to its current markets. Agarwal attributes this growth to market share shifting from unorganized to organized players in Tier-II and Tier-III cities.

However, despite its growth, Citykart's store count remains lower than its peers; V-Mart has 497 outlets, and Vishal Mega Mart operates 696 stores. SoftBank-backed e-commerce platform Meesho also focuses on smaller towns as over 85 per cent of its users coming from Tier-II towns and beyond. According to an April report by CLSA, Meesho held a 37 per cent market share in terms of order volume among various e-commerce platforms in calendar year 2024.

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