Ola’s IPO, one of the biggest in India this year, will see the company issue new shares to raise $660 million. Image: X@OlaElectric
The initial public offering of SoftBank-backed Indian e-scooter maker Ola Electric is expected to attract bids from investors including Fidelity, Nomura and Norway’s Norges Bank, as well as several Indian investment funds, two sources with direct knowledge told Reuters.
Ola Electric’s roughly $740 million IPO is set to open this week, the first by an Indian electric vehicle maker. The company is the largest player in the e-scooter market in a country where clean vehicle adoption is still low but rising rapidly.
Fidelity will make a bid of about $75 million, while Nomura and Norges will each bid $100 million into Ola’s so-called IPO anchor book, with leading institutional investors allocated shares before subscription opens to other investors, the first source with direct knowledge of the amounts offered said.
At least four Indian mutual funds, including SBI, HDFC, UTI and Nippon India, will bid, the two sources said. The first source estimates the combined bid size at over $700 million.
Ola Electric did not respond to a request for comment. None of the investors named above immediately responded outside regular business hours Sunday.
In Ola’s IPO, one of the largest in India this year, the company will issue new shares to raise $660 million. Existing investors, including founder Bhavish Aggarwal, will also sell their stake of about $80 million to IPO investors.
According to the first source, the quota for anchor investors in the IPO is about $330 million.
Sources had previously said the IPO would value the company at around $4.2 billion to $4.4 billion, but the sources said on Sunday the final valuation would be lower, at between $4 billion and $4.2 billion.
That valuation is about 22 to 26 percent lower than Ola’s last funding round in September, which was led by Singaporean investment firm Temasek and valued the country’s largest e-scooter maker at $5.4 billion.
According to sources, the lower valuation for the IPO is a result of a correction in the valuation of international technology companies globally and because Ola wants to ensure high participation in the share issuance.
The IPO comes amid increased activity in India’s capital markets, with stock markets near record highs.
(Only the headline and image of this report may have been edited by Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)
First print: Jul 29, 2024 | 06:41 AM IST