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Ola Electric's ₹7,250 Crore IPO Set to Energize EV Market

Ola Electric Charges Ahead: Secures Sebi Approval for ₹7,250 Crore IPO

12 June 2024

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Neelesh Bachani

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1. Ola Electric's IPO will consist of a fresh issue worth Rs 5,500 crore and an offer for sale (OFS) of Rs 1,750 crore, totaling Rs 7,250 crore. This capital infusion will support the company’s expansion and product development in the EV market.


2. Founder Bhavish Aggarwal will sell 47.3 million shares, while initial investors like AlphaWave and Matrix will sell a combined 47.89 million shares in the OFS, allowing early stakeholders to realize returns and attract new investors.


3. Sebi's approval of the draft red herring prospectus signifies a critical milestone for Ola Electric, positioning it strongly in the growing electric vehicle sector as it prepares to go public.

 

Ola Electric, a prominent electric vehicle manufacturer, has made significant strides towards its initial public offering (IPO). The company recently filed its draft red herring prospectus (DRHP) with the Securities and Exchange Board of India (Sebi) on December 22. According to sources cited by Moneycontrol, Sebi has approved the upcoming IPO. This development marks a crucial step for Ola Electric as it aims to secure its position in the rapidly growing electric vehicle market.

 

The IPO is expected to consist of a fresh issue of Rs 5,500 crore. In addition to this, there will be an offer for sale (OFS) worth Rs 1,750 crore. Altogether, the total value of the IPO will reach approximately Rs 7,250 crore. The fresh issue will provide the company with much-needed capital to further its expansion plans and enhance its product offerings in the competitive EV sector.

 

In the offer for sale, existing shareholders are set to divest a substantial portion of their holdings. The report indicates that a total of 95.19 million shares will be sold through the OFS. This move allows early investors and stakeholders to realize some of their investments while providing new investors the opportunity to participate in Ola Electric's growth story.

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Notably, Bhavish Aggarwal, the founder of Ola Electric, is slated to sell 47.3 million shares as part of the OFS. This significant sale by the founder underscores the scale of the IPO and his confidence in attracting new investors. It also highlights the strategic decisions being made to balance shareholding and bring in fresh capital.

 

In addition to Aggarwal's sale, initial investors such as AlphaWave, Alpine, DIG Investment, Matrix, and others will collectively sell 47.89 million shares. These investors have been instrumental in Ola Electric's journey so far, and their decision to participate in the OFS reflects both a milestone in their investment lifecycle and the maturation of Ola Electric as a publicly traded company.

 

The approval from Sebi and the structured IPO plan indicate that Ola Electric is well-prepared to enter the stock market. This move not only aligns with the company's growth objectives but also positions it to leverage the increasing demand for electric vehicles. As Ola Electric moves forward, the IPO is expected to play a pivotal role in shaping its future trajectory and market presence.

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