Ola Electric IPO attracts $2B of bids from institutions: Report

Ola Electric’s initial public offering (IPO) saw bids worth $2 billion from institutions as the electric vehicle (EV) maker gears up to open for retail investors tomorrow, Reuters reported.

The report, citing sources with direct knowledge of the matter, said the SoftBank-backed EV maker has allocated shares to Nomura Bank and some Indian mutual funds.

It allocated Nomura and Norges Bank around $24 million each, while SBI and HDFC Mutual Funds got shares worth $30-$36 million each.

The quota for institutional investors was set at $330 million and completed on Thursday. It will open for bidding to retail investors on August 2 and will close on August 5.

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Ola Electric plans to raise $734 million and is selling shares between Rs 72 and Rs 76 apiece.

Co-founder and promoter-selling shareholder Bhavish Aggarwal will sell 3.79 crore equity shares and promoter group Indus Trust will sell 41.79 lakh equity shares in the OFS. 

The offering features a new issue of equity shares worth Rs 5,500 crore, along with an offer for sale of up to 84 million shares.

According to the red herring prospectus filed by the company, the EV two-wheeler maker reported widening losses of Rs 1,584 crore for the year ended March 31, 2024, compared to a loss of Rs 1,472 crore for the previous year.  

In an event hosted in Bengaluru, Aggarwal said the company is banking on low costs as volumes rise, high revenue and integration of in-house manufactured Lithium-ion batteries to reach profitability.

However, Aggarwal did not outline a timeline for the company’s path to profitability.

(Disclaimer: Shradha Sharma, Founder and CEO of YourStory, is an independent director in Ola Electric)