Ola Electric Mobility fixes IPO price band at ₹72-76 per share
Company plans to mobilise up to ₹6,145 crore via fresh issue and OFS
Ola Electric Mobility Ltd., which is into manufacturing of electric two-wheelers, has announced an initial public offering (IPO) to raise upto ₹6,145.56 crore from the capital market.
The price band of the IPO has been fixed at ₹72-76 per equity share of a face value of ₹10 each. The IPO will open on August 2 and close on August 6. Investors can bid for a minimum of 197 shares and in multiples of 197 shares thereafter. The IPO consists of fresh issue of up to ₹5,500 crore and an offer for sale (OFS) of up to 8,49,41,997
equity shares by promoter selling shareholders and investor selling shareholder amounting to ₹645.56 crore at the upper price band. From the proceeds of the fresh issue, about ₹1,228 crore will be used for capital expenditure incurred by the subsidiary OCT; ₹800 crore for repayment or pre-payment, in full or part, of the indebtedness incurred by the subsidiary, OCT; ₹1,600 crore for investment into research and product development; ₹350 crore for expenditure to be incurred for organic growth initiatives and general corporate purposes.
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Bhavish Aggarwal, Chairman and Managing Director, Ola Electric Mobility Ltd., while announcing the IPO said, “We are holding a strong leadership position in the Indian automotive market. We have focused our attention in the EV space. We have a portfolio of 7 scooters and have announced to introduce 4 motorcycles.”
“Our model is vertically integrated across R&D and technology, manufacturing, supply chain, sales and service, and charging facilities,” he said, adding that the company was in the process of building its EV hub in Krishnagiri and Dharmapuri districts of Tamil Nadu for which the State Government had allocated 2,000 acres of land. Read CommentsREAD LATERPRINT
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Ola Electric mobility ipo issu 72 to 76 price brand
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
OLA Electric IPO Details
| IPO Date | August 2, 2024 to August 6, 2024 |
| Listing Date | [.] |
| Face Value | ₹10 per share |
| Price Band | ₹72 to ₹76 per share |
| Lot Size | 195 Shares |
| Total Issue Size | 808,626,207 shares (aggregating up to ₹6,145.56 Cr) |
| Fresh Issue | 723,684,210 shares (aggregating up to ₹5,500.00 Cr) |
| Offer for Sale | 84,941,997 shares of ₹10 (aggregating up to ₹645.56 Cr) |
| Employee Discount | Rs 7 per share |
| Issue Type | Book Built Issue IPO |
| Listing At | BSE, NSE |
| Share holding pre issue | 3,687,072,258 |
| Share holding post issue | 4,410,756,468 |
OLA Electric IPO Reservation
| Investor Category | Shares Offered |
|---|---|
| QIB Shares Offered | Not less than 75% of the Net Issue |
| Retail Shares Offered | Not more than 10% of the Net Issue |
| NII (HNI) Shares Offered | Not more than 15% of the Net Issue |
OLA Electric IPO Timeline (Tentative Schedule)
OLA Electric IPO opens on August 2, 2024, and closes on August 6, 2024.
| IPO Open Date | Friday, August 2, 2024 |
| IPO Close Date | Tuesday, August 6, 2024 |
| Basis of Allotment | Wednesday, August 7, 2024 |
| Initiation of Refunds | Thursday, August 8, 2024 |
| Credit of Shares to Demat | Thursday, August 8, 2024 |
| Listing Date | Friday, August 9, 2024 |
| Cut-off time for UPI mandate confirmation | 5 PM on August 6, 2024 |
OLA Electric IPO Lot Size
Investors can bid for a minimum of 195 shares and in multiples thereof. The below table depicts the minimum and maximum investment by retail investors and HNI in terms of shares and amount.
| Application | Lots | Shares | Amount |
|---|---|---|---|
| Retail (Min) | 1 | 195 | ₹14,820 |
| Retail (Max) | 13 | 2535 | ₹192,660 |
| S-HNI (Min) | 14 | 2,730 | ₹207,480 |
| S-HNI (Max) | 67 | 13,065 | ₹992,940 |
| B-HNI (Min) | 68 | 13,260 | ₹1,007,760 |
| Lot Size Calculator | |||
OLA Electric IPO Promoter Holding
The promoter of the Company is Bhavish Aggarwal.
| Share Holding Pre Issue | 85.77% |
| Share Holding Post Issue |
About Ola Electric Mobility Limited
Founded in 2017, Ola Electric Mobility Limited is an electric vehicle company that primarily manufactures electric vehicles and certain core components for electric vehicles such as battery packs, motors, and vehicle frames at the Ola Futurefactory.
Since August 2021, the company has launched seven new products and announced four. The Ola S1 Pro, the first EV model, was delivered in December 2021, followed by the Ola S1, Ola S1 Air, Ola S1 X and Ola S1 X+ in the following years. On August 15, 2023, the company announced new EV models and a range of motorcycles including Diamondhead, Adventure, Roadster, and Cruiser.
As of October 31, 2023, the company operates its “omnichannel distribution network across India, comprising 870 experience centers and 431 service centers (including 429 service centers in experience centers), in addition to the Ola Electric website.
In FY 2023, around 75% of 2W exports from India were destined for Africa, LATAM, and South East Asia, while teh domestic supply of E2W was limited.
The business model relies on three key scalable platforms:
- The R&D and technology platform with in-house design and development of EV technologies and components,
- The adaptable production and supply chain platform and
- The D2C omnichannel sales platform
As of March 31, 2024, the company had 959 employees (including 907 permanent employees and 52 freelancers) who focus on research and development. They are dedicated to product development, vehicle and software development, vehicle design, and cell development.
Ola Electric Mobility Limited Financial Information (Restated Consolidated)
Ola Electric Mobility Limited’s revenue increased by 88.42% and profit after tax (PAT) dropped by -7.63% between the financial year ending with March 31, 2024 and March 31, 2023.
| Period Ended | 31 Mar 2024 | 31 Mar 2023 | 31 Mar 2022 | 31 Mar 2021 |
| Assets | 7,735.41 | 5,573.17 | 5,395.86 | 2,112.64 |
| Revenue | 5,243.27 | 2,782.70 | 456.26 | 106.08 |
| Profit After Tax | -1,584.40 | -1,472.08 | -784.15 | -199.23 |
| Net Worth | 2,019.34 | 2,356.44 | 3,661.45 | 1,970.62 |
| Reserves and Surplus | -2,882.54 | -1,380.03 | -68.83 | 1,999.30 |
| Total Borrowing | 2,389.21 | 1,645.75 | 750.41 | 38.87 |
| Amount in ₹ Crore | ||||
Key Performance Indicator
The market capitalization of OLA Electric IPO is Rs 33521.75 Cr.
KPI as of March 31, 2024.
| KPI | Values |
|---|---|
| RoNW | -78.46% |
| P/BV | 13.72 |
Check OLA Electric IPO Peer Comparison here.
| Pre IPO | Post IPO | |
|---|---|---|
| EPS (Rs) | -4.3 | -3.59 |
| P/E (x) | -17.69 | -21.16 |
Note:
- The Pre IPO EPS is calculated based on Pre issue shareholding as on date of RHP and the latest FY earnings as of March 31, 2024 that is available in RHP.
- The Post Issue EPS is calculated based on the Post issue shareholding and annualized FY earnings of March 31, 2024 that is available in RHP.
Objects of the Issue (OLA Electric IPO Objectives)
The company proposes to utilise the Net Proceeds towards funding the following objects:
- Capital expenditure to be incurred by its Subsidiary, OCT for expansion of the capacity of its cell manufacturing plant from 5GWh to 6.4 GWh, classified as phase 2 under the expansion plan(the “Project”);
- Repayment or pre-payment, in full or part, of the indebtedness incurred by its Subsidiary, OET;
- Investment into research and product development;
- Expenditure to be incurred for organic growth initiatives; and
- General corporate purposes.