Key Takeaway
Ola Electric aims to raise $661.8 million in its IPO and plans to utilize a portion of the proceeds to expand its manufacturing capacity and focus on EV expansion. The company, which leads the EV scooter market in India, is targeting a valuation of $6.5 billion to $8 billion in the IPO.
India’s Ola Electric is planning to raise $661.8 million through the sale of new shares in its upcoming initial public offering (IPO). The Bengaluru-based startup, which was valued at $5.4 billion in its recent funding round, is targeting a valuation of $6.5 billion to $8 billion in the IPO. The company also intends to sell approximately 95.2 million shares from existing investors and shareholders, including founder Bhavish Aggarwal, Alpha Wave Ventures, Tiger Global, Matrix Partners, and SoftBank.
Expanding Manufacturing Capacity and EV Expansion
Ola Electric plans to utilize around $150 million of the total proceeds to expand the manufacturing capacity of its electric vehicle cell factory. The company aims to increase the capacity to 6.4 gigawatt hours from the current 5 gigawatt hours. Additionally, it plans to focus on major EV expansion into cars, batteries, and cells, with a significant manufacturing hub in India. Bhavish Aggarwal's vision includes producing the company’s own two-wheelers, cars, and lithium cells.
Financials and Market Position
The company reported losses of $176 million in the fiscal year 2023. Ola Electric listed several risk factors in its report, including potential changes in government incentives for local electric vehicle manufacturers and the possibility of significant managerial changes. Despite these challenges, Ola Electric has made significant strides in the EV market. It currently leads the EV scooter market in India, commanding about 35% of the market share. Notably, its IPO marks the first by a two-wheeler maker in the country in over 15 years.
