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Ola Cabs Revs Up for $500 Million IPO, Backed by SoftBank

From Roads to Skies, Ola's Journey to IPO Dominance

20 April 2024

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Kunal Tyagi

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  • Ola Cabs plans an IPO to raise $500 million, targeting a company valuation of $5 billion, backed by SoftBank.

  • The IPO submission to India's market regulator is expected within three months, with engagement of top investment banks like Goldman Sachs and Citi.

  • Despite prior valuations reaching $7 billion, recent assessments by investors like Vanguard peg Ola's worth at $1.9 billion, signaling evolving market dynamics.

In the bustling landscape of India's ride-hailing industry, Ola Cabs is gearing up for a significant financial move—an initial public offering (IPO) aiming to raise $500 million, which would value the company at about $5 billion. This strategic step, backed by SoftBank, underscores Ola's ambition to assert itself alongside global giants like Uber. According to sources familiar with the matter, Ola intends to submit IPO papers to India's market regulator within the next three months, setting the stage for a pivotal moment in the company's trajectory.


In preparation for its IPO, Ola is actively engaging with top-tier investment banks such as Goldman Sachs, Bank of America, Citi, and Indian firms Kotak and Axis. These discussions also involve plans to finalize IPO advisers within a month. This effort represents Ola's second attempt at going public, following a 2021 initiative to raise up to $1 billion that was ultimately shelved. Despite prior valuations reaching $7 billion, recent internal assessments by investors have lowered this figure significantly, with Vanguard marking Ola's worth at $1.9 billion earlier this year.


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The brainchild of entrepreneur Bhavish Aggarwal, Ola has emerged as a prominent player in India's startup ecosystem, drawing comparisons to visionary leaders like Elon Musk. Beyond its ride-hailing operations, Ola also leads India's electric scooter market through its subsidiary Ola Electric, which is itself poised for an IPO. This dual-track strategy underscores Ola's commitment to transformative mobility solutions.


Despite ongoing challenges, including recent layoffs and the discontinuation of international operations in the UK, Australia, and New Zealand, Ola has made strides in cutting losses and streamlining its core business. Notably, the company's fiscal losses were halved in the year ending 2023, a testament to its efforts to achieve operational efficiency in a competitive market.


In the broader context of India's startup ecosystem, Ola's IPO represents a significant milestone, reflecting the company's resilience and adaptability amid evolving market dynamics. As Ola navigates the IPO process and charts its future course, all eyes will be on how this pioneering startup continues to shape the landscape of transportation and technology in India and beyond.


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