Homegrown EV manufacturer Ola Electric is preparing to launch its initial public offering (IPO) in India on August 2, 2024. The company has confirmed the date in a filing with the Securities and Exchange Board of India (SEBI). The company’s IPO will allow retail investors to purchase shares worth up to $740 million, which will value the company between $4.0 billion and $4.2 billion. Interestingly, this would be a lower valuation than the company’s last round, which valued it at $5.4 billion.
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How Many Shares Will Be Available As Part Of The IPO?
According to the draft red herring prospectus (DRHP), Ola Electric is offloading around 95 million shares. Out of these, the company’s founder, Bhavish Aggarwal, will offload around 37.9 million shares, while other investors, like AlphaWave, Alpine, DIG Investment, and others, will sell around 47.89 million shares. While institutional investors will be able to invest in the IPO on August 1, retail investors can start placing their bids from August 2. Following this, the window for retail subscriptions will close on August 6.
Ola Electric Share Price
Given that Ola Electric has the largest market share in the e-scooter category, the IPO could be a turning point in the company’s trajectory. According to a blog by Upstox, the IPO has set a price band of Rs. 72 to Rs. 76 per share. Eligible employees will also get a Rs. 7 per share discount. Further, the IPO contains equity shares worth Rs. 5,500 cores and an offer-for-sale component of 8.49 crore shares. From the investment, the company plans to utilize Rs. 1,227.6 crore to expand its cell manufacturing plant’s capacity.
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The IPO Has Attracted Several Institutional Investors
Considering Ola’s impact on the Indian market, the IPO will reportedly get bids from institutional investors like Fidelity (about $75 million), Nomura (about $100 million), and Norway’s Norges Bank (about $100 million). As mentioned earlier, Ola Electric is targeting a lower valuation with the IPO, as it wants to ensure higher participation from institutional and retail investors. Several Indian mutual funds, like those from Nippon India, UTI, HDFC, and SBI, would also want to add the share to their portfolio.
Retail investors can use apps like Zerodha Kite, Groww, Motilal Oswal, etc., to place their bids. It is important to mention that Ola Electric’s IPO will be one of the largest this year. The only other IPO that could be bigger is that of Hyundai’s Indian subsidiary, but the company hasn’t confirmed anything yet.
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