Ola Electric Mobility IPO to hit Dalal Street on August 2 with fresh issue of Rs 5,500 crore

Among investors, SVF II Ostrich (DE) LLC, the largest shareholder in the company with a 21.98 percent stake (or 8.1 crore shares post-conversion of CCPS), offloading 2.38 crore shares in the OFS.

Alpha Wave Ventures II LP, Alpine Opportunity Fund VI LP, Internet Fund III Pte, MacRitchie Investments Pte, Matrix Partners India Investments III LLC, Tekne Private Ventures XV, and Ashna Advisors LLP are other selling shareholders.

Further, the company has reserved up to Rs 5.5 crore worth of shares for its employees.

Up to 75 percent of shares of the net public issue (excluding employees' portion) are reserved for qualified institutional buyers, 15 percent shares for non-institutional investors (high net worth individuals), and the remainder 10 percent for retail investors.

Shareholding Before the OLA IPO

Promoters including Bhavish Aggarwal, and Indus Trust hold 45.14 percent stake in the Bengaluru-based company, while the 47.19 percent shareholding is owned by public shareholders and the remaining 7.67 percent shares by employee trusts.

OLA IPO Proceeds Utilisation

OLA, which manufactures electric vehicles (EVs) and certain core EV components (like battery packs, motors, and vehicle frames at the Ola Futurefactory) intends to spend Rs 1,227.64 crore out of the net fresh issue proceeds, for the capacity expansion of subsidiary OCT's cell manufacturing plant (Ola Gigafactory) from 5 GWh to 6.4 GWh.

The Ola Futurefactory is the largest integrated and automated E2W manufacturing plant in India (in terms of production capacity) by an E2W-only OEM (original equipment manufacturer), as of March 2024.

Furthermore, through the fresh issue money, it will repay the debt of Rs 800 crore incurred by its subsidiary, OET. As of June 15 this year, its debts amounted to Rs 996.67 crore on a consolidated basis.

In addition, Rs 1,600 crore will be spent on research and product development, and Rs 350 crore will be used for business expansion through organic growth initiatives. The remainder of the IPO funds will be utilised for general corporate purposes.

Financial Performance

OLA, which delivered its first EV scooter in December 2021 continued to record robust topline, although it has been loss making. In fact, the net loss has widened to Rs 1,584.4 crore in the fiscal year ended March 2024, from Rs 1,472 crore in the previous fiscal. Revenue from operations during the same period spiked to Rs 5,009.8 crore, up by 90.4 percent from Rs 2,630.9 crore in the previous year.

The loss at the EBITDA level (earnings before interest, tax, depreciation and amortisation) stood at Rs 1,267.6 crore in FY24, widening from a loss of Rs 1,252.4 crore in FY23.

The company, which operates its direct-to-customer (D2C) omnichannel distribution network across India, comprising 870 experience centres and 431 service centres, sold 3.29 lakh units in the year gone by (FY24), more than doubling from the sales of 1.56 lakh units in the previous year.

OLA had a 35 percent market share in the electric two-wheeler (E2W) segment by the end of fiscal 2024, up significantly from 21 percent in the previous financial year.

India is the second largest 2-wheeler market globally in terms of domestic sales, while E2W adoption has grown rapidly to reach approximately 5.4 percent of total 2-wheeler registrations in fiscal 2024. E2Ws are projected to account for 41-56 percent of the domestic 2-wheeler sales volume by FY28.

OLA IPO Allotment Date

Meanwhile, the finalisation of the basis of allotment of OLA IPO shares will be done by August 7, while the OLA IPO shares will be credited to the demat accounts of successful investors by August 8.

OLA IPO Listing Date

The trading in Ola Electric Mobility IPO shares will commence on the BSE and NSE effective August 9.

Kotak Mahindra Capital Company, BofA Securities India, Axis Capital, SBI Capital Markets, Citigroup Global Markets India, Goldman Sachs (India) Securities, ICICI Securities, and BOB Capital Markets are the merchant bankers on the issue.