Ola Electric, the pureplay electric scooter manufacturer, has filed its Draft Red Herring Prospectus (DRHP) with the Securities and Exchange Board of India (SEBI) on Friday evening (December 22). This move follows the earlier CNBC-TV18 newsbreak, anticipating the filing.
Fundraising details:
Ola Electric aims to raise funds through a combination of a fresh issue of equity shares, aggregating up to ₹5,500 crore, and an offer for sale (OFS) of up to 9.52 crore shares. Notably, Bhavish Aggarwal, the promoter, plans to sell 4.7 crore shares, constituting 50% of the total OFS.
Other entities divesting stakes: Apart from Bhavish Aggarwal, entities like Indus Trust, Kaha Wave Ventures, Alpine Opportunity Fund, DIG Investment Internet Fund, MacRitchie Investments, Matrix Partners India Investments, SVF II Ostrich, and Tekne Private Ventures XV are also divesting stakes in the IPO.
Regulatory compliance: Ola Electric disclosed that it paid a penalty of ₹15 lakh to the Ministry of Road Transport and Highways (MoRTH) after one of its S1 scooters caught fire in Pune in March 2022.
Rise in borrowings and debt: The company notes that it may continue to incur operating losses in the near term as it invests in business and expands its product portfolio.
Utilisation of IPO proceeds: Ola Electric plans to utilise the IPO proceeds for various purposes, including the expansion of its electric vehicle (EV) portfolio, investment in a gigafactory, and boosting sales.
Potential operating losses: Acknowledging the possibility of operating losses in the near term, Ola Electric signals its dedication to investing in business expansion and portfolio diversification. An estimated ₹1,600 crore is earmarked for Research and Development (R&D) over the next three years.
Sales performance: Ola Electric reported its highest-ever sales in November 2023, with 30,000 units sold, securing a market share of 35%. Since its launch in December 2021, the company has sold over 300,000 electric vehicles. In December alone, the firm sold 9,841 e-scooters, contributing to the total FY24 sales of over 1.8 lakh vehicles.
Impressive revenue growth: The company's revenue has seen a substantial increase, reaching ₹2,630.93 crore in FY24, compared to ₹373.42 crore in FY23, showcasing robust financial performance.
Investors interested in subscribing to Ola Electric's IPO are encouraged to closely review the DRHP and stay updated on market developments. The IPO promises to be a key event in the evolving landscape of electric mobility and investment opportunities in India.
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