Ola Electric has filed its Draft Red Herring Prospectus (DRHP) for an initial public offering (IPO) to the Securities and Exchange Board of India (SEBI) on Friday evening, December 22, confirming the CNBC-TV18 newsbreak that the pureplay electric scooter manufacturer will file it tonight.
Ola Electric has proposed to raise funds through 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. Ola Electric promoter Bhavish Aggarwal will divest 4.7 crore shares via OFS in the IPO, which is 50% of the total OFS.
Ola Electric has exercised the option to raise ₹1,000 crore via pre-IPO placement, and in that case, the fresh issue size will be reduced to that extent, as the company mentioned in its DRHP.
Apart from Bhavish Aggarwal, 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 the other entities divesting stakes.
Among other notable information, the company mentions that it paid a penalty of ₹15 lakh to the MoRTH after an S1 scooter caught fire in Pune in March 2022.
Ola Electric's total borrowings or debt have risen to ₹1,617 crore in FY24 from ₹39 crore in FY21. The portion of IPO proceeds will be used for the repayment of loans owed by subsidiaries from Axis Bank and Bank of Baroda. Ola Electric aims to use its IPO proceeds to increase its EV portfolio, gigafactory, and sales.
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.
Ola Electric intends to use ₹1,264 crore from IPO proceeds as capex for expanding its Gigafactory’s capacity. Another ₹800 crore will be used for debt payment and ₹350 crore for organic growth initiatives. A sum of ₹1,600 crore will be required for R&D over the next three years.
The company recorded its highest-ever sales of 30,000 units in November 2023, giving it a market share of 35%. It has sold over 300,000 vehicles since its launch in December 2021. In December, the firm sold 9,841 e-scooters, and in FY24, its sales have surpassed 1.8 lakh vehicles until now.
The company's revenue has increased to ₹2,630.93 crore in FY24 from ₹373.42 crore in FY23.
(Edited by : Ajay Vaishnav)
First Published: Dec 22, 2023 6:41 PM IST
