Ola Electric's $740 mn IPO likely in August, targeting $4-4.25 billion valuation

Ola Electric may drive into D-street & launch $740 mn IPO in first fortnight of August

Bhavish Aggarwal-led Ola Electric, which is backed by Japanese investment major Softbank, is gearing up to launch its widely-anticipated initial public offer as early as in the first fortnight of August, multiple industry sources in the know told Moneycontrol.

The proposed listing, first ever by an Indian EV two-wheeler, would mark a landmark moment for the domestic auto sector and encourage peers like Ather Energy to consider value unlocking plans.

"The firm is looking to raise around $740 million via a combination of a fresh issue and an offer for sale and is targeting a post-money valuation between $4-4.25 billion," one of the persons familiar with the development told Moneycontrol.

The targeted valuation was derived to provide an opportunity for investors to generate returns, another person privy the process told Moneycontrol.

Both the persons spoke on the condition of anonymity. When contacted, Ola Electric declined to comment.

The firm had filed its draft red herring prospectus (DRHP) with the markets regulator Sebi on December 22, 2023.

On May 25, Moneycontrol was the first to report that Ola Electric had roped in Kotak Mahindra Capital and Goldman Sachs as advisors for an IPO .

On April 19, Moneycontrol was also the first to report that ANI Technologies, the parent company of Ola Cabs, had initiated preliminary discussions with investment banks as the holding firm also evaluates the potential launch of an initial public offer of the ride hailing business.

Ola Electric's last funding round in September was led by Singapore investment giant Temasek, which valued the company at $5.4 billion.

As per its draft papers, Ola Electric's IPO comprised a fresh issue of Rs 5,500 crore and an offer for sale (OFS) of Rs 1,750 crore totalling Rs 7,250 crore. Existing shareholders were said to sell 95.19 million shares in the OFS.

Founder Bhavish Aggarwal will be selling 47.3 million shares. The firm’s initial investors — AlphaWave, Alpine, DIG Investment, Matrix, and others will also be selling 47.89 million shares via the OFS as per the draft papers.

As per the DRHP, Ola Electric will utilise the proceeds for capex, repaying debt, and research and development (R&D).