Ola Electric Mobility, the biggest electric scooter manufacturer in India, is encountering resistance from investors regarding the valuation it aims to achieve in its upcoming IPO, as per sources familiar with the situation cited by Bloomberg.
The company’s founder is aiming for a potential valuation of up to $7 billion (₹58,494 crore) in a Mumbai listing, sources said, requesting anonymity as the information is not public yet. This contrasts with initial investor feedback suggesting a valuation of around $5 billion (₹41,781 crore).
Investors in Ola Electric may choose to hold onto their shares, as discussions are ongoing, and no decisions have been finalized yet. A representative from Ola Electric has not responded to Bloomberg’s request for comment.
Ola Electric plans to raise ₹5,500 crore in its IPO, backed by SoftBank Group Corp. and Tiger Global Management, with approval from India’s market regulator.
The scooter maker’s IPO is timely amidst India’s positive performance in Asia’s equity capital markets, as per Bloomberg.
Bankers anticipate further developments as the previous uncertainty surrounding the country’s elections has dissipated, and optimism about economic growth continues to be high.
The IPO is a component of the company’s ambitious strategies aimed at venturing into battery-operated vehicles and electric vehicle (EV) cells. Bhavish Aggarwal, the founder, is constructing what he claims to be the world’s biggest electric vehicle center in southern India to manufacture battery-operated two-wheelers, cars, and lithium-ion cells. The startup has additionally introduced electric motorcycles, as mentioned in the report.
Ola Electric plans to use some of the funds to increase its electric vehicle cell factory’s manufacturing capacity to 6.4 gigawatt hours from 5 gigawatt hours, as per the report.
Kotak Mahindra Capital Co., Citigroup Inc., Bank of America Corp., and Goldman Sachs Group Inc. are among the banks involved in the share sale, as stated in the prospectus.
