Ola Electric, helmed by Bhavish Aggarwal, is set to make history with its much-anticipated IPO, marking the first listing of an Indian EV two-wheeler firm on Dalal Street. Scheduled to open from August 2 to August 6, with the weekend falling on August 3 and 4, Ola Electric's debut is slated for August 9. This IPO is the first by an automaker in India since Maruti Suzuki's offering in 2003.
The company aims to raise approximately $740 million through a mix of fresh issues and an offer for sale (OFS), targeting a post-money valuation between $4 billion and $4.5 billion. As India’s leading electric vehicle manufacturer, Ola Electric will position itself against competitors like TVS Motors, Bajaj Auto, and Ather Energy.
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Important IPO Dates
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Offer Period
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2nd - 4th August
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Issue Details
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Fresh Issue - 5500 cr & OFS - 8.49 cr shares
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Face Value
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Rs 10/share
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Price Band
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Rs 72 - 76
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Retail Minimum Bid
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Rs 14,820 shares for 195 shares
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Post Issue Market Cap
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Rs 32,048 cr - 33,522 cr
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Listing
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BSE & NSE
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Allotment Date
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7th August 2024
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Credit of Shares to Demat A/c
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8th August 2024
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Listing Date
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9th August 2024
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Shareholding Pattern:
The equity share capital of Ola Electric is divided among three main categories: Promoter and Promoter Group, which holds 45.14%; Public Shareholders, accounting for 47.19%; and the Employee Trust, owning 7.67%. Notable stakeholders include Bhavish Aggarwal, the founder, with a 36.94% share, SoftBank with 21.98%, Tiger Global with 6.03%, Indus Trust with 3.85%, and Alpha Wave with 3.49%. This distribution indicates significant founder ownership and major investments from prominent firms, alongside substantial employee ownership through the Employee Trust.
Ola Electric's IPO has also attracted attention due to key investors like Paytm's Vijay Shekhar Sharma and filmmakers Zoya and Farhan Akhtar, who are retaining their shares. They acquired shares at Rs 60.36 and are seeing 26% gains at the upper price band of Rs 72-76 per share.
Sharma's investment via VSS Investco was Rs 7.5 crore for seven Series C preference shares, now worth Rs 9.46 crore. Zoya Akhtar bought one share for Rs 1.07 crore, and Farhan Akhtar bought two for Rs 2.14 crore. After conversion, Sharma holds 12.45 lakh shares, Zoya Akhtar 1.78 lakh, and Farhan Akhtar 3.56 lakh.
Some pre-IPO investors may incur losses, as the public issue price is below their acquisition cost—a rare situation for recent tech IPOs. While early investors like Tiger Global are set to gain, others like Alpine Opportunity Fund VI LP, which bought shares at Rs 111.51, may see losses of over 30% at the upper price band of Rs 76.
Financial Performance:
Ola Electric reported a 7.6% increase in net loss to INR 1,584.4 crore for FY24, up from INR 1,472.1 crore the previous year, despite remarkable revenue growth. According to the red herring prospectus filed on July 26, the company's operating revenue surged over 90% to INR 5,009.8 crore, driven by strong vehicle sales, compared to INR 2,630.9 crore in FY23.
The startup, led by Bhavish Aggarwal, generates its entire revenue from e-scooter sales. The Ola S1 Pro is the top contributor, accounting for nearly 60% of total revenue. The Ola S1 Air contributed 18.93%, while the Ola S1's revenue share dropped to 2.68% in FY24 from 29.36% the previous year. Ola Electric sold 3.29 lakh vehicles in FY24, significantly up from 1.56 lakh units sold in the prior fiscal year.
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IPO Share Sale Details:
Bhavish Aggarwal will offload 20% fewer shares, approximately 37.91 million, during the IPO compared to the initially planned 47.39 million shares, as stated in the Red Herring Prospectus filed on July 27. Additionally, DIG Investment has likely exited its equity stake in Ola Electric, having planned to sell around 839,941 shares through the Offer for Sale (OFS). The investment firm previously held a 0.95% stake in the company.
In October 2023, Ola Electric issued Series E preference shares worth Rs 2,398 crore ($300 million). This round saw participation from Temasek, Blue Investments, DIG Investments, Tiger Global, Tekne Private Ventures, and Ashutosh Vinayak Joshi.
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