In a significant development, Ola Electric, under the leadership of Bhavish Aggarwal, has received approval from the Securities and Exchange Board of India (SEBI) for its eagerly anticipated initial public offering (IPO), according to sources familiar with the matter.
Path to IPO Approval
The approval, granted earlier today, paves the way for Ola Electric’s imminent listing on the exchanges, with the company targeting a debut within a month, as confirmed by one of the sources. While an official statement from the markets regulator is awaited, the latest update signals a major milestone in Ola Electric’s journey towards public listing.
IPO Details and Stakeholders
Ola Electric’s IPO, as outlined in its draft red herring prospectus (DRHP) filed in December last year, comprises a fresh issue of INR 5,500 crore and an offer for sale (OFS) component of up to 9.51 crore shares. Founder and CEO Bhavish Aggarwal, along with prominent investors such as SoftBank, Temasek, Tiger Global, and others, will participate in the OFS.
Industry Firsts
This public issue marks a historic moment, as it will be the first IPO by any electric vehicle (EV) maker in India and the first by any automaker in the last two decades. Ola Electric’s IPO underscores the growing investor interest in the EV segment and reaffirms the company’s position as a key player in the industry’s evolution.
Utilization of Funds
Proceeds from the IPO will be channeled towards Ola Electric’s ambitious Ola Gigafactory project, aimed at establishing a 100 GWh capacity for battery production at full scale, in addition to manufacturing EVs, batteries, and other components. The company also plans to allocate funds for research, product development, organic growth, and general corporate purposes, including debt repayment.
Financial Performance
Despite widening net losses, Ola Electric’s financials reflect robust growth, with sales surging by 605% to INR 2,630.9 crore in FY23. The startup’s continued dominance in the Indian two-wheeler EV space, boasting close to 50% market share, underscores its strong market position and growth trajectory.
Operational Streamlining
Amidst preparations for its IPO, Ola Electric recently announced plans to streamline operations, including a reported reduction of 400-500 employees to optimize costs. Additionally, the startup secured a debt of INR 100 crore ahead of the IPO, further strengthening its financial position.
