Ride-hailing giant Ola’s electric vehicle arm, Ola Electric, has filed draft papers with India’s market regulator for an initial public offering (IPO) with a targeted fundraising of ₹5,500 crore.
The planned IPO will comprise an issue of fresh shares, while CEO Bhavish Aggarwal will sell up to 4.74 crore shares, as outlined in the draft red herring prospectus (DRHP) with Securities and Exchange Board of India.
The funds generated from the fresh issue will be allocated to various purposes, including capital expenditure for the Ola Gigafactory project by the subsidiary, OCT, debt repayment by subsidiary OET, investment in research and product development, expenses related to organic growth initiatives, and general corporate purposes.
Ola Electric commands a significant presence in India’s electric two-wheeler sector, boasting a 32 per cent market share and facing competition from industry players like TVS Motor, Bajaj Auto, and Ather Energy, as per data from the Society Of Manufacturers Of Electric Vehicles.
Despite its dominance, the battery scooter manufacturer has adjusted its sales targets for 2023-2025, reducing them by more than half and postponing its profit target by a year.
Ola Electric’s IPO coincides with a surge in IPO activity in India, with a record 213 IPOs this year, including those from Tata Technologies and JSW Infrastructure, amid soaring benchmark indexes.
Kotak Mahindra Capital Company, Citigroup Global Markets India, BofA Securities India, Goldman Sachs (India) Securities, Axis Capital, ICICI Securities, SBI Capital Markets, and BOB Capital Markets are the book-running lead managers to the offer. The equity shares are proposed to be listed on the BSE and NSE.
(Inputs from wires)