The leading manufacturer of electric two-wheelers in India, Ola Electric Mobility Ltd., has finally submitted a draft red herring prospectus (DRHP) for its initial public offering (IPO) to the Securities and Exchange Board of India (SEBI) following a few months of inactivity.
The IPO of Ola Electric combines an offer for sale with a new issue. In addition to selling 95,191,195 shares to its current investors, which include founder Bhavish Aggarwal, the company intends to issue shares valued at Rs 5,500 crore.
With a 36.9% interest rate, Aggarwal is currently the company’s largest stakeholder. SoftBank’s SVF II Ostrich (DE) LLC is second with a 22% investment. According to the DRHP, Aggarwal intends to sell 47,394,014 shares in the public offering, while SVF II will sell 23,857,268 shares.
Ola Electric announced that it would use Rs 1,226.43 crore of the net proceeds from the new issuance for debt repayment, Rs 1,600 crore for research and development, and Rs 1,600 crore for expanding the capacity of its Giga plant in Tamil Nadu to manufacture cells.
Ola Electric’s EV market in India
As of October 31, 2023, the company’s total outstanding borrowing on a consolidated basis was Rs 1,768.82 crore. “There are no outstanding borrowings of our company or any of our subsidiaries, with the exception of our material subsidiary and our subsidiary Ola Cell Technologies,” stated Ola Electric. The business does not operate any joint ventures and has ten subsidiaries.
With its issuance, Ola Electric becomes the first manufacturer of electric vehicles to go public as well as the first carmaker to do so in 20 years. Based in Bengaluru In 2021, Ola Electric unveiled its first electric scooter. At the moment, the company produces electric cars as well as parts including motors, battery packs, and vehicle chassis. It purchases cells from other vendors and is creating new cell technologies and cell production techniques.
With a market share of more than 30%, Ola Electric is still the leading player in the nation’s electric two-wheeler market with its current lineup of three electric scooter models. The company sold nearly 253,000 electric two-wheelers in the calendar year 2023, compared to 156,261 units sold in 2022–2023.
The business runs an omnichannel direct-to-customer distribution network with 414 service centres and 935 experience centres. The State Bank of India and Temasek-led investors helped the Bengaluru-based startup raise Rs 3,200 crore in October through a combination of financing and equity. The money will go towards growing the company and establishing a factory in Krishnagiri, Tamil Nadu, to produce lithium-ion cells.
The company declared a consolidated net loss of Rs 1,472.08 crore for the fiscal year 2022–2023. During that time, operations brought in a total of Rs 2,630.93 crore.
