Karooooo, a technology company with roots in South Africa, has become one of the top performers on the Johannesburg Stock Exchange (JSE). Over the past year, its share price has surged by 46%, thanks to its steady growth in revenue and earnings, as well as successful global expansion efforts.
Though headquartered in Singapore, Karooooo was originally founded in South Africa. The company is best known for its Cartrack software-as-a-service platform, which offers real-time data analytics and business intelligence services to businesses worldwide.
Karooooo was founded by Zak Calisto, who started Cartrack in South Africa in 2001 as a joint venture with Netstar. Calisto, who had previously worked at Cell Communications and Vehicle Tracking Services, saw an opportunity to create a company focused on vehicle tracking, combining the best technologies available at the time. Cartrack separated from Netstar in 2004 and quickly became a leader in tracking, data analytics, and business intelligence under Calisto’s guidance.
In April 2021, Calisto made a strategic move to delist Cartrack from the JSE and instead list Karooooo on the Nasdaq, while keeping a secondary listing on the JSE. This decision was aimed at giving the company a stronger financial platform to grow internationally while still allowing South African shareholders to participate.
Karooooo has expanded its presence across multiple regions, including South Africa, the Asia Pacific, the Middle East, the United States, and Europe. All these regions have shown strong subscriber growth, particularly in Asia Pacific, the Middle East, and the United States, where growth rates averaged 25%. Overall, the company’s subscriber base grew from 1.37 million in 2021 to 2.05 million in 2024.
This subscriber growth has translated into strong financial results. Karooooo’s revenue grew at an average annual rate of 24% over the past three years. Its two main business segments, Cartrack and Karooooo Logistics, both saw good revenue growth and remained operationally profitable. In the latest quarter, Cartrack reported operating profits of R287.2 million, while Karooooo Logistics, formed after acquiring a 70.1% stake in Picup, achieved R13.4 million in operating profits.
Karooooo has been effective in managing its costs, a key factor in its profitability. While the cost of goods sold (COGS) increased slightly from 29% to 31% of revenue between 2021 and 2024, operating expenses were reduced from 44% to 41%. Similarly, finance costs and taxes were cut from 13% to 7%, boosting the company’s net profit margin from 14% to 20%.
The company also maintains a strong financial position, with a debt ratio reduced from 56% in 2021 to 31% in 2024, indicating lower reliance on debt. Its current ratio improved to 1.52, and its cash ratio nearly reached 1.0, demonstrating strong liquidity and the ability to cover its short-term obligations with cash.
Karooooo’s valuation ratios, such as the price-to-earnings (P/E) ratio of 24.9, price-to-book (P/B) ratio of 6.39, and price-to-sales (P/S) ratio of 4.65, suggest that investors are confident in the company’s continued growth. Although these ratios are near historical averages, they indicate that the company is fairly valued given its strong performance.
Karooooo has shown significant growth and stability, making it a noteworthy player on the JSE and a successful example of a South African-founded company thriving on the global stage.
