Ola Electric likely to be listed on Indian stock markets
Ola Electric: SoftBank-backed Indian e-scooter maker Ola Electric may value the company at about $4.5 billion for its initial public offering (IPO), about 16%-20% lower than the valuation of its last funding round, two sources told Reuters. In June, the Indian market regulator approved Ola’s $660 million stock market listing, the first IPO by an EV maker in India and set to be one of the country’s biggest share sales this year. Two sources with direct knowledge of the matter said Ola Electric is likely to list on Indian stock markets in the first week of August, but declined to be named as the discussions are private. Ola Electric did not immediately respond to a request for comment.
Ola Electric’s previous funding round in September, led by Singaporean investment firm Temasek, valued it at $5.4 billion, but one of the sources said it would likely decline this time, pointing to a “reevaluation” in valuations of tech stocks globally. “Overall valuations in the market have improved,” the person said, adding that the final valuation could still change but is unlikely to reach close to at least $6 billion, which Ola Electric founder Bhavish Aggarwal had hoped to garner for the IPO. Ola Electric’s valuation is likely to be lower because “the company wants the IPO to be priced attractively so that there is an opportunity for investors to create wealth,” the second source said. India is witnessing a sharp surge in IPOs, with its stock markets near record highs. Benchmark Indian stock indices have doubled between 2019 and 2023.
The country’s booming stock market overtook Hong Kong earlier this year to become the world’s fourth-largest. South Korea’s Hyundai Motor also plans to list its Indian unit, aiming to raise up to $3 billion at a valuation of up to $30 billion. Ola Electric was founded in 2017. It dominates the e-scooter market with a 46% share and competes with TVS Motor, Bajaj Auto and Ather Energy. In December last year, Ola Electric slashed its sales targets for 2023-25 by more than half and deferred its goal of turning a profit by a year after e-scooter prices rose due to a reduction in government incentives. Its consolidated loss widened to 14.72 billion Indian rupees ($176.14 million) for the year ended March 2023, while revenue from operations grew more than sevenfold.
