Ola Electric to raise $734m in India's biggest IPO this year
Tuesday, 30 July 2024
MUMBAI, July 29 (Reuters): Indian e-scooter maker Ola Electric said on Monday it aimed to raise $734 million in the country's biggest IPO this year, a deal set to lure major foreign investors and highlight growing confidence in India's financial markets. A stock market boom has already led more than 150 Indian companies to raise nearly $5 billion through public listings in the country between January and July, nearly double the figure for the same period last year, LSEG data shows.
The first IPO by an Indian electric vehicle maker will let investors bet on a clean energy push by Prime Minister Narendra Modi's government, as well as firms from Tata Motors and TVS Motor to Hyundai Motor.
"Our mission is to really make India a global EV hub," Ola's chairman Bhavish Aggarwal told reporters at a press conference in Mumbai, where he posed for photographs sitting on his e-scooters that start retailing at $900.
SoftBank-backed Ola Electric has become the biggest player in a country where adoption of clean vehicles is still low, but rising rapidly. It had 46 per cent of the e-scooter market as of June 30 despite slashing sales goals last year.
"Tesla is for the West and Ola for the rest," has become a catchphrase linked to Aggarwal, who is betting big on cleaner vehicles.
Aggarwal had plans to start selling an electric car in 2024, but Reuters reported they have been suspended to let the company focus on e-scooters and EV battery cells. It also plans a foray into electric bikes.
Aggarwal said Ola had a good product line up in place for e-motorbikes.
Ola's aggressive push into e-scooters has already disrupted the market forcing a pivot by incumbents such as TVS, Hero MotoCorp and Bajaj Auto. Its entry into the motorcycle segment, which makes up two-thirds of total two-wheelers sold in the country, will intensify competition.
A term sheet for the IPO, which will run from Aug. 1 to Aug. 6, puts a value of $4 billion on the company, which sold its first scooter in 2021.
That valuation is about 25 per cent lower than Ola's last funding round in September, led by Singapore's investment firm Temasek (TEM.UL) which valued the EV maker at $5.4 billion.