Ola Electric plans to file DRHP with SEBI by December 20, targets $700 million in IPO funding

Ola Electric is gearing up to submit its Draft Red Herring Prospectus (DRHP) to the Securities and Exchange Board of India (SEBI) by December 20, as reported on December 11. The company aims to raise a substantial $700 million through its Initial Public Offering (IPO) and has set a valuation goal between $7-8 billion by early 2024.

Backed by SoftBank, Ola Electric intends to utilize the funds from the IPO for expanding its electric vehicle (EV) business and establishing a lithium-ion cell manufacturing unit. The company recently made headlines for adjusting its sales targets for 2023-2025 by over 50 percent and postponing its profitability target due to reduced government incentives impacting e-scooter prices.

Ola Electric transformed into a public company on November 17, a crucial step toward its IPO, involving corporate restructuring and a name change from Ola Electric Mobility Private Limited to Ola Electric Mobility Limited. The conversion to a public company is a necessary procedure for companies planning to list on the stock exchange.

The IPO, expected in early 2024, will involve a combination of primary and secondary share offerings, with Kotak Mahindra Capital and Goldman Sachs enlisted for the process. Ola Electric recently closed a funding round of approximately Rs 3,200 crore (around $380 million) with contributions from Temasek-led investors and debt from the State Bank of India. These funds will support the expansion of Ola's EV business and the establishment of India's first lithium-ion cell manufacturing facility in Krishnagiri, Tamil Nadu.

Ola Electric, having expanded its scooter portfolio to five products in February 2023, continues to position itself as a significant player in the electric vehicle market.