OLA IPO: Ola Electric, the Indian e-scooter maker backed by SoftBank, is set to value the company at approximately $4.5 billion for its upcoming initial public offering (IPO), a 16-17 per cent drop from its last private equity valuation of $5.4 billion, according to a report by Moneycontrol. This move aligns Ola Electric with a trend observed in other start-ups such as Mamaearth and GoDigit, which also pursued IPOs at lower valuations than their previous private equity rounds.
ABP Live independently couldn't verify the authenticity of the news. Ola Electric has not yet responded to requests for comment regarding the valuation.
On June 20, Ola Electric received official approval from the Securities and Exchange Board of India (SEBI) for its IPO, aiming to raise Rs 7,250 crore. According to SEBI's website, the IPO includes a fresh issue of Rs 5,500 crore and an Offer for Sale (OFS) of Rs 1,750 crore, with the observation letter issued on June 10.
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In September, Ola Electric's valuation reached $5.4 billion in a funding round led by Singapore's investment firm Temasek. However, a source indicated a "recalibration" of tech stock valuations globally, contributing to the current lower valuation.
It was first reported on May 25 that Ola Electric has enlisted Kotak Mahindra Capital and Goldman Sachs to manage the IPO slated for early 2024. Founder Bhavish Aggarwal will be selling 47.3 million shares, while initial investors — including AlphaWave, Alpine, DIG Investment, and Matrix — will sell 47.89 million shares through the OFS.
According to the Draft Red Herring Prospectus (DRHP), funds from the IPO will be allocated as follows: approximately Rs 1,226 crore for capital expenditures, Rs 800 crore to repay debt, Rs 1,600 crore for research and development, and Rs 350 crore for inorganic growth.
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