In June, the Indian markets regulator approved Ola’s stock market listing for USD 660 million, marking the first IPO by an EV maker in India and potentially one of the most significant share sales in the country this year.
Backed by SoftBank, the Indian e-scooter manufacturer Ola Electric is preparing for an initial public offering (IPO), expected to value the company at approximately USD 4.5 billion. According to two sources cited by Reuters, this valuation is roughly 16%- 20% lower than the figure from its last financing round.
In June, the Indian markets regulator sanctioned Ola’s USD 660 million stock market debut, which represents the first IPO from an electric vehicle (EV) maker in India and is poised to be among the most significant share offerings in the nation this year. Currently, Ola Electric has not responded to requests for comments on this matter.
In September, a funding round led by Temasek, a Singapore-based investment company, valued Ola Electric at USD 5.4 billion. However, current indications suggest a downturn in this valuation due to a global “recalibration” of tech stock valuations, as noted by one of the sources.
The overall market valuations have experienced a correction, remarked one insider, who noted that while the final valuation might adjust, it is not expected to reach the minimum USD 6 billion valuation Ola Electric’s founder, Bhavish Aggarwal, initially anticipated for the IPO.
Another source mentioned that the valuation might be set lower to make the IPO more appealing and to offer investors a chance to generate wealth.
India has recently experienced a significant increase in IPOs, with its stock markets nearing all-time highs. The country’s stock market has doubled in value from 2019 to 2023, surpassing Hong Kong’s earlier this year to become the fourth largest in the world. Additionally, South Korea’s Hyundai Motor plans to list its India unit, aiming to raise USD 3 billion at a valuation of up to USD 30 billion.
Since its establishment in 2017, Ola Electric has led the e-scooter market in India, holding a 46% market share and competing with firms like TVS Motor, Bajaj Auto, and Ather Energy.
In a recent strategic shift, Ola Electric adjusted its sales objectives for 2023-25 downward by over half. It delayed its profit targets by a year following a hike in e-scooter prices driven by reduced government incentives. For the fiscal year ending March 2023, the company reported a consolidated loss of 14.72 billion Indian rupees (approximately USD 176.14 million), even though its revenue from operations surged more than sevenfold.
