Ola Electric set for IPO with Rs 12-13 GMP, price band at Rs 72-76 a share

The grey market premium (GMP) for Ola Electric's shares is estimated at Rs 12-13, suggesting a potential premium of 16% over the issue price

Ola Electric is gearing up for its initial public offering (IPO), which will open for subscription on August 2. The grey market premium (GMP) for the company's shares is estimated at Rs 12-13, indicating a potential premium of 16 per cent over the issue price.

The IPO price band is established at Rs 72-76 per share.
 

This IPO, the first from an electric vehicle manufacturer, includes a fresh issue amounting to Rs 5,500 crore and an offer for sale of 84.9 million shares. Investors can place bids for a minimum of 197 shares and in multiples thereafter.
 

During a press meet on Monday, Ola’s founder and CEO Bhavish Aggarwal said, “I wanted to make sure we price it attractively for the entire investor community in India and in the private rounds, whatever the valuations are, it was very important for us and for me personally, to make sure that we get the whole Indian investor community along on this journey.”

He further added, “We wanted to make sure we appeal to the widest spectrum of investors we can and hence in our judgement felt this is the right price and the response has been very encouraging.”

Proceeds allocation for growth and R&D

The company plans to allocate the proceeds from the new issue to several key areas: funding the working capital expenditure of its subsidiary OCT, repaying Rs 800 crore of the subsidiary’s debt, investing Rs 1,600 crore in research and product development, and earmarking Rs 350 crore for organic growth initiatives and general corporate expenses.

Established on February 3, 2017, Ola Electric is a leading EV manufacturer in India. The company focuses on developing vertically integrated technology and manufacturing capabilities for EVs and their components, including cells. At its Ola Future Factory, it produces EVs and essential components such as battery packs, motors, and vehicle frames.

Ola Electric unveils new motorcycle lineup

On August 15, 2023, Ola Electric introduced a new lineup of motorcycles with four models: Diamondhead, Adventure, Roadster, and Cruiser. The company intends to begin deliveries of these motorcycles in the first half of Fiscal 2026. Since its inception, Ola Electric has sold a total of 506,817 units of the Ola S1 and Ola S1 Pro by March 31, 2024.

Ola Electric is currently developing an EV hub in the Krishnagiri and Dharmapuri districts of Tamil Nadu, India, which includes the Ola Future Factory, the upcoming Ola Gigafactory, and co-located suppliers in the Krishnagiri district.

In FY24, Ola Electric’s revenue from operations increased by 90.42 per cent to Rs 5,009.8 crore compared to FY23. However, the company’s losses also grew, reaching Rs 1,584.4 crore in FY24, up from Rs 1,472 crore the previous year.