July 27, 2024
New Delhi, India
Ola Electric IPO Watch
Bhavish Aggarwal-led Ola Electric is gearing up to launch its highly anticipated initial public offering (IPO). The IPO’s anchor book is set to open on August 1, with the issue likely to be available for public subscription from August 2 to August 6, according to multiple industry sources cited. As per the proposed timeline, Ola Electric is set to become the first-ever Indian EV two-wheeler company to list on Dalal Street, with its market debut expected on August 9.
The Bhavish Aggarwal-owned company’s IPO is one of India’s biggest this year, and it has garnered significant interest from investors. Ola Electric, although still loss-making, has managed to capture a 46% market share in e-scooters within three years since its founding.
Key Details:
- IPO Timeline: The anchor book launches on August 1, and the public subscription period is from August 2 to August 6.
- Listing Date: The IPO listing is likely to take place on August 9.
- Valuation: The IPO aims for a valuation of around $4.4 billion.
Ola founder Bhavish Aggarwal already operates an e-scooter factory in Tamil Nadu. In 2022, he announced plans to build a new plant within the same campus with a capacity to manufacture 1 million electric cars annually. However, the company has suspended its electric car launch plans to focus on its e-scooter business, as per a Reuters report citing sources with direct knowledge of the decision.
Financials and IPO Details:
Ola Electric filed its draft red herring prospectus (DRHP) with the market regulator SEBI on December 22, 2023. According to the DRHP, the company plans to raise up to $660 million through the IPO, which will include an Offer for Sale (OFS) of 95.19 million shares by existing shareholders. Founder Bhavish Aggarwal will be selling 47.3 million shares, while the firm’s initial investors—AlphaWave, Alpine, DIG Investment, Matrix, and others—will be selling 47.89 million shares via the OFS.
Investment Banks and Legal Counsel:
Kotak Mahindra Capital, Axis Capital, Goldman Sachs, ICICI Securities, Citi, BofA Securities, SBI Caps, and BoB Caps are the investment banks working on the deal. Law firm Cyril Amarchand Mangaldas is serving as the company counsel.
Use of Proceeds:
As per the draft papers, Ola Electric will utilize the proceeds for capital expenditure (capex), repaying debt, and research and development (R&D).
Aggarwal laid out plans in 2022 to launch an electric sports car with an all-glass roof that could reach 100 km per hour within four seconds. However, the focus has now shifted entirely to the two-wheeler market, including bikes, as mass electrification and necessary infrastructure are still developing.
With this IPO, Ola Electric is set to mark a significant milestone in India’s EV sector, paving the way for further advancements and investments in electric mobility.
Disclaimer:
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