SoftBank-backed FirstCry, Ola Electric to file draft IPO papers in the next week

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Electric two-wheeler company Ola Electric and e-commerce firm FirstCry, both of who have SoftBank as their common investor, are preparing to file their draft IPO papers by next week, sources aware of the developments told Moneycontrol.

In November, SoftBank had even marked up the valuations of both the firms, along with a few others in its portfolio, signalling the investor's optimism in the two companies ahead of the IPO.

"FirstCry is looking to raise $500 million and 60 percent of that will be the offer for sale (OFS) component while the remaining will be the primary part," one of the people cited above said.

While FirstCry is likely to list only after the general election in 2024, Ola Electric's management has already begun roadshows with domestic and international investors, the person added.

More recently, Ranjan Pai's MEMG Family Office, Harsh Mariwala's Sharrp Ventures and Hemendra Kothari's DSP family office picked up shares worth Rs 435 crore in FirstCry, per reports.

The Pune-based startup will be the first large e-commerce firm to IPO after Nykaa listed in 2021.

“Our portfolio has been resilient and agile in the face of these macro uncertainties. If you look at our portfolio of 475 companies, by fair value 92 percent have a cash runway of more than 12 months. So, a lot of these companies have pivoted to capital efficient growth,” SoftBank's Govil had told Moneycontrol in the interview. 

Ola Electric 

Moneycontrol was the first to report that Ola Electric has roped in Kotak Mahindra Capital and Goldman Sachs for an IPO in early 2024. At the time, sources said the planned IPO will be a combination of primary and secondary share offerings.

The electric vehicle manufacturing company also announced that it has closed a Rs 3,200 crore (approximately $380 million) funding round with a mix of debt and equity from Temasek-led prominent investors and debt from the State Bank of India (SBI).

The funds from IPO as well the pre-IPO rounds was planned to be used to expand Ola's EV business and to set up India's first lithium-ion cell manufacturing facility in Krishnagiri, Tamil Nadu.

"In the next six to nine months, our total manufacturing capacity will go up to 2 million from the present 1 million per annum. The capacity we have right now can be expanded up to 10 million per annum and that is our ultimate goal," Ola Electric's CEO Bhavish Aggarwal said in an earlier interaction with Moneycontrol.

Ola is also estimating its sales to touch 0.3 million in FY 24 and 0.9 million by FY 25; in FY 23 Ola sold 0.15 million units of EVs.

This comes at a time when Ola Electric's consolidated revenue stood at Rs 2,782 crore up nearly 510 percent in FY23, but its net loss widened from to Rs 1,472 crore double of Rs 784 crore that it reported in FY22.

On December 6, Ola Electric, in a note to investors and the bankers  said that it is targeting an Ebitda profitability of Rs 803 crore in FY25. The firm has also said that its Ebitda loss will come down to Rs 950 crore in FY24.  The company has projected a revenue of Rs 4,655 crores in FY 24.