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Ola Electric Mobility Ltd., India’s biggest e-scooter maker, is seeking as much as 61.46 billion rupees ($734 million) in an initial public offering that will test investor appetite for the EV makers amid increasing adoption.
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The startup, backed by SoftBank Group Corp. and Tiger Global Management LLC, has set a price range of 72 rupees to 76 rupees a share, the company said in an advertisement in a local newspaper. The bidding starts Aug. 2 and closes on Aug. 6 while shares are expected to start trading Aug. 9.
The company is issuing as many as 723.8 million shares, according to the terms of the listing seen by Bloomberg News. Existing shareholders are selling up to 84.9 million shares, fewer than the 95.19 million previously planned.
The share sale will fuel the company’s expansion plans, as founder Bhavish Aggarwal builds what he touts as the world’s largest electric vehicle hub to produce battery-powered two-wheelers, cars and lithium-ion cells. The Bengaluru-based firm plans to expand capacity at its cell manufacturing plant, repay debt and invest in research, it said in the offer document.
Ola Electric is the latest to tap equity investors in India’s booming IPO market — one of the hottest spots globally this year as surging valuations and good economic prospects lure issuers. IPOs in India have raised $4.5 billion so far this year, more than double the amount in the same period last year, according to data compiled by Bloomberg.
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Electric vehicle-linked firms are increasingly looking at public markets to raise money amid growing demand for alternative fuel vehicles in India. The local unit of Hyundai Motor Co. is expected to list this year, in what could be the biggest IPO in India so far. Other EV-linked firms, such as Ather Energy Pvt. and Tata’s battery business Agratas are also aiming for a listing.
Potential Valuation
At the upper end of the marketed range, the listing would give Ola a market value of about $4 billion, according to the terms. The company’s founder was seeking a potential valuation of as much as $7 billion in a Mumbai listing before facing investor pushback, Bloomberg News reported last month.
Aggarwal is selling as much as 38 million shares — the biggest chunk — while SoftBank’s SVF II is selling up to 23.9 million shares and Tiger Global’s Internet Fund III is selling up to 6.4 million shares.
Ola Electric sold 35% of all electric two-wheelers in India in financial year ending March 31. It has an electric motorbike, as well as India’s cheapest e-scooter as a part of its product lineup. The firm raised $385 million in October last year for expansion and to set up a lithium-ion cell plant.
Goldman Sachs (India) Securities, Kotak Mahindra Capital Company Ltd., BofA Securities India Ltd., Axis Capital Ltd., and SBI Capital Markets Ltd. are among the book running lead managers for the IPO.
(Updates with details throughout.)
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