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Ola Electric, founded by Bhavish Aggarwal, is set to make history as the first Indian electric vehicle (EV) company to go public. The Securities and Exchange Board of India (SEBI) has approved a substantial INR 7,250 crore initial public offering (IPO) for the company. This milestone positions Ola Electric to potentially launch its IPO within the next month, although the exact timing remains unconfirmed.
The IPO structure includes a fresh issue of equity shares worth INR 5,500 crore and an offer for sale (OFS) of over 95 million equity shares, valued at around INR 1,750 crore. Aggarwal himself plans to sell up to 47.4 million shares, which represents a 3.48% stake. Other significant shareholders participating in the sale include Indus Trust, Tiger Global’s Internet Fund III, SoftBank Vision Fund, and Alpha Wave Ventures.
This IPO stands out as the first public offering by a two-wheeler manufacturer in decades and represents Aggarwal’s debut in taking a company public. Ola Electric aims for a valuation between $7 billion and $8 billion.
Since entering the EV market in 2017, Ola Electric has quickly ascended to a leadership position, commanding over 35% market share in FY24, up from 21% in FY23, according to VAHAN portal data. The funds raised from the fresh issue will be allocated to various strategic initiatives, including INR 1,226 crore for capital expenditure, INR 800 crore for debt repayment, and INR 1,600 crore for research and development (R&D). Additionally, INR 350 crore will be directed towards organic growth initiatives.
Financially, Ola Electric’s revenue surged by 510% to INR 2,782 crore in FY23 from INR 456 crore in FY22. However, despite the revenue boost, the company’s net loss nearly doubled to INR 1,472 crore in FY23 from INR 784.1 crore the previous year, driven by significant increases in expenses. The company reported an EBITDA loss of INR 1,318 crore in FY23 as total expenses soared to INR 3,383 crore from INR 1,240 crore in FY22.
With SEBI’s approval and a buoyant market, Ola Electric is on the brink of a transformative chapter, poised to set new benchmarks in the Indian EV sector.
