Zoomcar Holdings to transfer listing amid compliance efforts

Zoomcar Holdings, Inc. (NASDAQ:ZCAR), a Delaware-incorporated auto rental service with a market capitalization of just $2.91 million, has announced its plan to transfer its stock listing to The Nasdaq Capital Market as part of its ongoing efforts to comply with Nasdaq's listing requirements. According to InvestingPro data, the company's stock has seen a significant 30.5% return over the last week, though it remains down 99% over the past year. The decision follows a recent determination by a Nasdaq Hearing Panel, which granted Zoomcar's request for continued listing on the condition that it meets specific criteria by March 31, 2025.

The company, which is currently listed under the symbols (NASDAQ:ZCAR) for its common stock and NASDAQ:ZCARW for its warrants, faced potential delisting due to non-compliance with Nasdaq's market value requirements. InvestingPro analysis reveals concerning financial health indicators, with the company's current ratio at just 0.07, indicating significant challenges in meeting short-term obligations. In November 2024, Zoomcar received a delist determination letter from Nasdaq for not meeting the market value of listed securities rule. In January 2025, the company was notified of an additional deficiency regarding the market value of publicly held shares.

In response, Zoomcar presented a compliance plan to a Nasdaq Hearing Panel and later submitted a plan addressing the market value of publicly held shares deficiency. InvestingPro data shows the company operates with a debt-to-capital ratio of 0.86 and is quickly burning through cash, with negative free cash flow of -$14.54 million in the last twelve months. Get access to 14 more exclusive ProTips and comprehensive financial metrics with InvestingPro to stay ahead of market developments. The Panel's recent decision requires Zoomcar to demonstrate compliance with the Equity Rule, which necessitates a stockholders' equity of at least $2.5 million for continued listing on The Nasdaq Capital Market.

Zoomcar is actively working to fulfill the Panel's conditions and intends to apply for the transfer of its listing by February 19, 2025. While the company is taking diligent steps to address the Panel's requirements, there is no guarantee of success in maintaining its Nasdaq listing.

This news is based on a recent SEC filing by Zoomcar Holdings and contains forward-looking statements regarding the company's efforts to meet the Panel's conditions. The outcome of these efforts is uncertain, and investors are cautioned not to place undue reliance on these statements. With revenue of $9.09 million and a gross profit margin of 26.2%, the company faces significant challenges ahead.

The information provided in this article is based on a press release statement.

In other recent news, Zoomcar Holdings has been involved in various financial activities and executive changes. The auto rental and leasing services provider successfully raised approximately $1.44 million in a second private placement offering. The offering was facilitated by Aegis Capital Corp., and the net proceeds, amounting to approximately $1.25 million, are earmarked for general corporate purposes.

In a separate development, Zoomcar Holdings is facing potential delisting from the Nasdaq Stock Market due to non-compliance with certain listing requirements. The company has been granted an initial 180-day period to regain compliance, and is currently preparing a compliance plan to present to a Nasdaq Hearing Panel.

Regarding executive changes, Zoomcar Holdings announced the appointment of Shachi Singh as an executive officer, who will continue to serve as the General Counsel and Chief Legal Officer. Furthermore, Hiroshi Nishijima transitioned from Active CEO to CEO, and Sachin Gupta, the CFO, received a salary increase.

In addition, Zoomcar Holdings entered into a material definitive agreement with select accredited investors as part of a private placement offering, raising $5.48 million in gross proceeds. Lastly, the company announced the immediate resignation of Mark Bailey from its board of directors. These are the recent developments from the company.

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