The company aims to generate up to Rs 5,500 crore by issuing new shares. If priced at the higher end of the range, the total value of the issue could reach Rs 6,145.56 crore.
Ola Electric Mobility Ltd has established the pricing range for its upcoming initial public offering (IPO) between Rs 72 and Rs 76 per share. At the higher end of this spectrum, the issue is anticipated to reach Rs 6,145.56 crore, comprising Rs 5,500 crore from the issuance of new shares and Rs 645.56 crore from the offer for sale (OFS).
The IPO is scheduled to open on August 2 and will conclude on August 6. During this period, existing shareholders, including founder Bhavish Aggarwal, are set to offer up to 9,51,91,195 shares with a nominal value of Rs 10 each. If the shares are priced at the lower end, the IPO’s value could ascend to approximately Rs 611.58 crore.
Retail individual investors will have access to up to 10% of the issue, while qualified institutional buyers are allocated 75%, and the remaining 15% is reserved for non-institutional buyers. Interested parties can place bids for a minimum of 197 equity shares and further increments of 197 shares thereafter.
Currently, Aggarwal holds the majority stake in the company at 36.9%, followed by SoftBank’s SVF II Ostrich (DE) LLC, which owns 22%. According to the Draft Red Herring Prospectus (DRHP), Aggarwal and the Indus Trust intend to sell up to 3,79,15,211 and 41,78,996 shares, respectively, while SVF II plans to offload 2,38,57,268 shares.
Ola Electric dominates the electric two-wheeler market in India, boasting over a 35% market share and competing with major players like Bajaj Auto, TVS Motor, Ather, and Hero MotoCorp. Having recently received regulatory approval for its IPO, the company aims to allocate Rs 1,226.43 crore of the net proceeds towards cell manufacturing at its forthcoming Giga factory in Krishnagiri, Tamil Nadu. Additionally, Ola Electric plans to invest Rs 1,600 crore in research and product development and use Rs 800 crore for debt repayment.
In the fiscal year 2023, Ola Electric reported a consolidated net loss of Rs 1,472.08 crore. The company has acknowledged the possibility of continued losses in the near term due to elevated operating expenses driven by product and sales expansion efforts. As of October 31, 2023, Ola Electric’s total consolidated borrowing stood at Rs 1,768.82 crore.
In a related development, Hyundai Motor India has also submitted a DRHP for an IPO featuring only an offer-for-sale component. Hyundai Motor Company, its South Korean parent, plans to reduce its ownership in its fully-owned Indian subsidiary by selling up to 14,21,94,700 shares, representing a 17.5% stake.
