Ola Electric to raise $734 million in India’s largest IPO this year, draws $2 billion in institutional bids

Indian electric scooter startup OLA Electric is set to raise $734 million in what will be the country’s biggest IPO this year. According to Reuters, the institutional investors have already received $2 billion worth of bids for the IPO, putting OLA Electric at the very forefront of India’s fast-growing electric vehicle market.

Institutional interest has been robust and share allocations have been made to marquee investors such as Nomura, Norges Bank, and a few Indian mutual funds, a source with direct knowledge told Reuters. The allocation amount for these marquee heavyweight investors was pegged at $330 million and the process concluded on Thursday.

Notably, SBI and HDFC Mutual Funds got shares of between $30 million to $36 million each, while Nomura and Norges Bank received about $24 million each, underscoring the strong institutional backing, Reuters said.

What’s more, this comes just weeks after a strategic call from OLA Electric to suspend its electric car project, squarely with the view to double down on the thriving e-scooter business. OLA Electric was founded in 2017 by Bhavish Aggarwal; it has set its share price at 72-76 rupees with an eye on a valuation of roughly $4 billion.

Ola Electric is a subsidiary of Ola, India’s premier ride-hailing service on a mission to offer green, accessible, and affordable electric transportation solutions. This IPO will not only consolidate its position in the EV market but also get them ready to make a difference like IPO debuts.

While the electric car venture got a little setback, OLA Electric e-scooters had captured a huge share of the market and are commanding almost 46 percent of the e-scooter sector within just three years of its launch, which is way different from electric car sales in India that reached about 45,000 units by mid-2023 compared to nearly half a million e-scooters sold during the same period.

OLA Electric focuses strategically on e-scooters; this speaks of the company’s adaptability to immediate market needs and infrastructural challenges. This commitment towards the two-wheeler market is evident by continuous product development on the battery front, sales strategies, and further expansion plans in Tamil Nadu.

As OLA Electric ramps up its IPO, its journey turns out to be the moment in India’s electric vehicle landscape that is going to gallop ahead and make the nation transition sustainably in transport.