Ola Electric's $734 million IPO plan marks the biggest Indian IPO this year
Ola Electric
IPOs in India continue to flourish. In the latest, Indian e-scooter maker Ola Electric has announced plans to raise $734 million. This marks the country's biggest IPO this year.
TheIPO would allow investors to bet on the clean energy push in the recent budget. Ola Electric would also look to capitalise on the growing demand for cleaner forms of energy. Major auto players like TVS, Hero MotoCorp and Bajaj Auto are also looking to foray into electric two-wheelers. Even global luxury brands like BMW have announced plans to introduce an electric motorcycle by September 2024. The competition is only expected to increase in times to come, with more electric auto startups joining the race.
Ola Electric's IPO puts the company value at $4 billion. The valuation is 25 per cent lower than Ola's last funding round in September. Ola's valuation in that funding round was $5.4 billion. The lower figure reportedly stems from a correction in global tech companies, changing market dynamics, and Ola's bid to attract more investors and make the deal more 'appealing'.
Ola will issue new shares to raise $657 million while existing investors offload their stake of about $77 million to prospective buyers, according to the IPO term sheet quoted by Reuters. Aggarwal and investors such as SoftBank will be part of the existing investors selling their stake.
Ola's chairman Bhavish Aggarwal said at a press conference, 'Our mission is to really make India a global EV hub', according to Reuters. He is also famous for this catchphrase, 'Tesla is for the west and Ola is for the rest.' However, the company faces thechallenge of a comparatively slower pace of EV adoption in the country. The demand for non-renewables is still present, and a complete energy transformation seems in the distant future.