Ola Electric files DRHP with SEBI, to raise Rs 5,500 Cr via fresh issue

Electric vehicle firm Ola Electric has filed its draft red herring prospectus (DRHP) with the Security Exchange Board of India (SEBI) for an initial public offering (IPO).

The company has proposed to raise funds through a fresh issue of equity shares aggregating up to Rs 5,500 crore and an offer for sale (OFS) of up to 95,191,195 equity shares.

Bhavish Aggarwal (the promoter) and Indus Trust  (promoter group selling shareholder) will offload 47,394,014 and 4,178,996 shares in the OFS. Alpha Wave, Alpine Opportunity, Tiger Global, Matrix Partners, DIG, Temasek, SoftBank, and Tekne Ventures will also participate in the offer for sale (OFS).

The company proposes to utilize the primary proceeds for the expansion of the capacity of its cell manufacturing plant, repayment or pre-payment of the indebtedness, investment into research and product development, organic growth initiatives, and general corporate purposes.

According to the DRHP, SoftBank is the largest external shareholder with a 21.98% stake followed by Tiger Global with a 6.03% share. ANI Technologies, Indus Trust, and Alpha Wave possess 4.35%, 3.85%, and 3.49% stakes, respectively. Matrix Partners, Hyundai, and Temasek hold 3.43%, 2.95%, and 3.02% shares in the company. The company’s founder and CEO Aggarwal, maintains a substantial 36.94% ownership in the company.

Kotak Mahindra Capital, Bofa Securities India, Axis Capital, and SEBI Capital Market are the book-running lead managers of the issue.

Ola Electric’s revenue from operations surged seven-fold to Rs 2,631 crore during the fiscal year ending March 2023 as compared to Rs 373 crore in FY22. However, the losses of the firm increased by 87.76% to Rs 1,472 crore in FY23. It also shared quarterly results for April-June 24, wherein the revenue stood at Rs 1,242 crore while losses stood at Rs 267 crore.

Ola Electric recently announced a $385 million funding round with a mix of equity and debt from Temasek-led marquee investors and the State Bank of India (SBI).

During the last fundraise, Ola Electric had said that it will kick off its lithium-ion cell manufacturing facility with an initial capacity of 5 gigawatt hours in phase I which will be further scaled up in phases to 100 gigawatt hours at full capacity.

Besides scooters, it has also introduced its motorcycle line-up scheduled to be launched by the end of next year.

The company’s closest competitor Ather Energy is also gearing up for IPO. As per media reports, it has plans to get listed by Diwali 2024 or early 2025.