Ola Electric Might Go for Upcoming IPO At $4.5 Billion Valuation: Report

Ola Electric is set to launch its public offering for subscriptions in the coming weeks. The expected valuation for this IPO is around $4 billion. This marks a decrease of about 25% from its last private funding round, as per an Economic Times report. 

In September 2023, the Electric Vehicle Company raised $140 million in a funding round led by Singapore's Temasek. At that time, the company was valued at $5.4 billion. Other companies that have gone public with a lower valuation include Mamaearth and GoDigit. 

While the company didn’t comment on it, a source speaking to Business Standard said, “The strategy is to price the IPO attractively for investors, fostering long-term growth and wealth creation.” 

In June, Ola Electric received the nod of the Securities and Exchange Board of India (SEBI) to go for an IPO. The company submitted its draft red herring prospectus (DRHP) to Sebi on December 22, planning to raise to Rs 5,500 crore via a fresh issue. Additionally, the proposal includes an offer-for-sale (OFS) of 95.2 million shares. 

This will be one of the first electric vehicle companies in the country to go public. Previously, it was reportedly mentioned that the company was eyeing a valuation of $6 billion, which has now been reduced to around $4 billion. 

Several companies are going public this year. This includes Swiggy, FirstCry, and others. Speaking to the Economic Times, a source said, “The valuation expectation has undergone readjustment since the EV major first filed its draft IPO papers. The company has agreed to a discount compared to its last round pricing.” 

Ahead of its IPO, the company is also focusing on cost-cutting. Recently, the company reportedly decided to cut 400–500 roles and focus on internal transfers rather than new recruitments. Additionally, Ola CEO Bhavish Agarwal said that the electric vehicle company will invest $100 million in a gigafactory that will help produce lithium-ion battery cells.