Ola Electric sets IPO price band at ₹72-76 per share

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EV mobility startup Ola Electric Mobility has set a price band of ₹72-76 per share for its upcoming initial public offering (IPO), which opens on on August 2.

The issue size of the start-up is₹6,145.6 crore at the upper price band. The IPO consists of a fresh issue of shares worth ₹5,500 crore and an offer-for-sale (OFS) of up to 8.49 crore shares worth ₹645.6 crore. The IPO will close on August 6.

Anchor investors window opens on August 1.

Ola co-founder Bhavish Aggarwal will sell 3.79 crore shares, and promoter group Indus Trust 41.79 lakh shares in the OFS.

The company’s revenue from operations increased to ₹5,009.8 crore in FY24 from ₹2,630.9 crore in FY23. It recorded a loss of ₹1,584.4 crore compared with ₹1,472 crore in FY23.

‘Consistent growth’

Speaking at a press conference ahead of the launch of the IPO , Aggarwal said company’s growth story is consistent and secular and added that he doesn’t see any slowing down of the EV story.

Harish Abichandani, CFO, Ola Electric, said that company’s installed capacity is 1 million for the Future Factory, although infrastructure can support up to 4 million units capacity. Last fiscal capacity utilisation was 49 percent utilisation.

Aggarwal said the EV two-wheeler maker is currently leading the market share in the space. Aggarwal also highlighted that the startup is aggressively working on its electric motorcycles.

Speaking on the profitability aspect, Aggarwal said that the company’s revenue is growing steadily and gross margin also improved in FY24. However, he did not give any timeline for achieving profitability or even EBITDA breakeven.

“As you grow revenue, you get a lot of operating leverage because your fixed costs don’t scale in line with revenue growth. So, that’s been our story in the last couple of financial years, whereas we have grown volumes and we have invested for a higher volume, as we are growing into that capacity, our margins are improving,” said Aggarwal.

Funds raised will be used for expansion of the installed capacity of Ola Gigafactory from 5GWh to 6.4GWh; repayment or pre-payment, in full or in part, of Ola Electric Technologies, its material subsidiary, working capital borrowings; investment in research and product development, including investments in property, plant and equipment and intangible assets; organic growth initiatives; and general corporate purposes.