The Securities and Exchange Board of India (SEBI has given approval for an initial public offering to electric two-wheeler maker Ola Electric. This is as per a report by the Economic Times.
This would be one of the biggest IPOs of 2024 and the first by an EV start-up. The draft red herring prospectus (DRHP) was filed by Ola Electric with the market regulator on December 22. The firm aims to raise Rs 5,500 crore in a fresh issue. It also aims to raise an offer for the sale of 95.2 million shares.
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Through the public offering, the company is planning for a valuation of $6 billion, as per the Economic Times. Further, 50 per cent of the total OFS, or 4.7 crore shares, would be offloaded by Ola Electric promoter Bhavish Aggarwal through the IPO's OFS.
Additionally, the company has exercised its option to raise ₹1,000 crore through pre-IPO placement. In that case, the size of the new offering will be lowered accordingly, as the company mentioned in the DRHP.
Meanwhile, with a focus on the IPO, Ola Electric is expected to lay off 400–500 employees as part of a cost-cutting exercise. Further, the impacted employees might be replaced by new hires who will come at a lower cost.
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Speaking to the Economic Times about the layoffs, a source said, ““Inside, they (the Ola Electric team) are finalizing the list across different teams. Three-four teams have already finalized the numbers, but the cuts would be across the organization."
The company’s sister firm, Ola Cabs, also laid off around 200 employees in April of this year as part of a restructuring exercise. Other companies that are expected to go public this year include Swiggy, FirstCry, Snapdeal, MobiKwik, and others. Additionally, SEBI has also cleared the public offering of Emcure Pharmaceuticals, a multinational pharmaceutical company. The company is likely to launch the issue in the next two months.
