Ola Electric Becomes the First Indian Electric Vehicle Manufacturer to Apply for an Initial Public Offering (IPO).
Ola Electric IPO: After much speculation, Ola Electric, the electric two-wheeler company, officially filed preliminary papers with SEBI on Friday, signaling its intention to raise funds through an initial public offering (IPO). Notably, this marks the first IPO by an automaker in two decades and the first time a pure electric vehicle (EV) company aims to list on domestic stock exchanges. The proposed IPO includes a fresh issue of equity shares amounting to Rs 5,500 crore and an offer for sale (OFS) of 9.52 crore equity shares, as outlined in the draft red herring prospectus (DRHP).
Founder Bhavish Aggarwal is set to sell up to 4.73 crore shares in the OFS, and other major stakeholders like SoftBank and Tiger Global will also be divesting their stakes. Reports suggest that the largest electric two-wheeler player in the country aims for a market capitalization as high as $8 billion. Ola Electric, having raised approximately $1 billion over the years, was last valued at $5.4 billion in October 2023.
According to the DRHP, the proceeds from the fresh issue will be utilized for the capital expenditure of the subsidiary, OCT, related to the Ola Gigafactory project, debt repayment by subsidiary OET, investments in research and product development, expenses for organic growth initiatives, and general corporate purposes.
In the financial year 2023, Ola Electric experienced significant revenue growth, reaching Rs 2,630.9 crore, compared to Rs 373.4 crore in the previous fiscal year. However, the company reported a loss of Rs 1,472 crore in FY23, an increase from the Rs 784.1 crore loss in FY22. Ola Electric, a key player in the e-2W segment competing with TVS Motor and Ather Energy, holds a substantial market share of about 35% as of November 2023.
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