MUMBAI: Homegrown electric scooter maker Ola Electric Mobility, which controls nearly 39% segmental market share, has fixed Rs 72-76 for the its Rs 6,146 crore primary share sale that is opening on August 2, nearly 26% less than what was planned earlier.
It will be the largest IPO in the past two years and the first from auto sector in 21 years after Maruti Suzki’s market entry in 2003. The issue is the maiden share sale form any electric two-wheeler manufacturer. While early investors will lose about 30%, for pre-IPO state investors like SoftBank, which is the single largest external shareholder, and Tiger Global and Matrix Partners ,among others, this is a windfall. Bhavish Aggarwal, firm’s promoter, holds 1.36 billion shares (36.94% stake), valued at `10,350 crore based on the price band. He acquired this stake for a negligible amount, as per the DRHP.
At the upper end of the price band, Ola Electric’s m-cap will be about $4 billion, down 25.8% from its $5.4 billion valuation in September 2023, led by Temasek. The lower IPO valuation is due to a global tech valuation correction and Ola’s strategy to boost participation, according to analysts.
Aggarwal, founder and Chairman of the EV-maker, told reporters here Monday to announce the share sale, that Ola’s growth story is consistent and secular and has the large potential and discounted the demand slowdown that the sector has been facing of late saying this is the future of mobility.
“We are a mission-driven company and our mission is to make India a global EV hub,” said Aggarwal. He said there doesn’t seem to be any slowing down of the EV story and that incumbents are joining the party. “EVs are the biggest transformation in the automotive industry in a century,” he said. His own capacity utilisation level of just about 49% of 1 million installed capacity doesn’t attest this optimism.
As per the company’s chief financial officer, Harish Abichandani, though the installed capacity is 1 million and has the infrastructure for up to 4 million unit capacity per annum, the average capacity utilisation in FY24 was only 49%.
The IPO comprises a fresh issue of Rs 5,500 crore and an offer for sale (OFS) of up to 84.94 million shares, or worth Rs 646 crore. On the upper price band, the issue will fetch Rs 6,145 crore.
Aggarwal and his family will divest 3.8%of their holding via the issue, paring their ownership to under 33% from 36.7% pre-issue, aggrawal told TNIE.
MapMyIndia accuses Ola Electric of copying data
NEW DELHI: Ola Electric has found itself in legal trouble with a mapping company. CE Info System, parent company of MapMyIndia. It has alleged that Ola Electric has copied data from them for its own mapping service Ola Maps. The two firms had formed a licensing agreement in 2022 that allowed the electric two-wheeler maker to use its navigation services for S1 Pro electric scooter. It prohibited Ola from integrating licenced product with similar competing product and from reverse engineering or attempting to extract or replicate the source code from any API or related software of the licensed product. ENS