Ola Electric has transformed itself into a publicly traded company as it gears up for its initial public offering (IPO) in the coming months. This major milestone involves carrying out a corporate restructuring to transform itself from a private company to a listed company, regulatory filings show.
According to the sources, the IPO could be between $800 million and $1 billion.
The conversion of a private company to a public company is a mandatory step for a company that wants to list on the stock exchange. The name of the company has been changed to Ola Electric Mobility Limited from Ola Electric Mobility Private Limited, the registration documents show.
“The next step is to file the Draft Red Herring Prospectus (DRHP),” said one. “It is a powerful tool that contains all critical information about a company, allowing investors to make an informed decision.”
SoftBank-backed Ola Electric is India’s largest manufacturer of electric vehicles (EVs) and has a market share of almost 35 percent.
The company recently raised around Rs 3,200 crore in funding as part of its equity and debt round. This financing was secured from Temasek-led major investors and project debt from the State Bank of India. The funding round, which also includes equity, has increased the valuation of the Bengaluru-based company to $5.5 billion from its previous valuation of $5 billion, according to sources. The funds raised are expected to create an interim event and pave the way for an initial public offering. This is expected to be one of the largest IPOs in the automotive sector in India.
The funds raised will be used to expand Ola’s electric vehicle (EV) business and set up India’s first lithium-ion (Li-ion) cell manufacturing facility in Krishnagiri (Tamil Nadu).
These funds will also enable Ola Electric to accelerate the growth of its two-wheeler manufacturing capacity and facilitate the launch of electric motorcycles, followed by electric cars, and expedite the construction of the Gigafactory.
The Bhavish Aggarwal-led company competes with Ather Energy, Okinawa Autotech, Ampere EV by Greaves, Hero Electric and TVS Motor Company. It also plans to produce electric cars, which will see it compete with Tata Motors and Mahindra & Mahindra, as well as global giants like Tesla and Hyundai. The company’s substantial investments in research and development and cell manufacturing are expected to support the success of its future products.
Ola Electric was selected by the government as the only Indian EV company under the ambitious Production-Linked Incentive (PLI)-Advanced Chemistry Cell (ACC) Scheme, which will receive a maximum capacity of 20 gigawatt hours (GWh). The PLI-ACC program will play an important role in localizing the most critical aspects of the EV value chain.
Ola is setting up a Li-ion cell manufacturing facility near its Futurefactory in Krishnagiri. This facility is the first of its kind for Li-ion cell manufacturing in India, with an initial capacity of 5 GWh in Phase I. It will be further scaled up to 100 GWh at full capacity in phases.