In a major development, Ola Electric has successfully concluded a substantial funding round, securing an impressive $140 million in investment. The funding round, led by Temasek Holdings, also saw active participation from existing investors. The official signing of the deal took place on Monday, marking a significant milestone for the electric vehicle (EV) company.
Both Ola Electric and Temasek have refrained from providing official comments regarding the fundraising at this time. However, it has come to light that Temasek Holdings has made a substantial contribution of approximately $90 million, while the remaining funds have been pooled in by various family offices. This round of funding has bolstered Ola Electric’s financial standing in the market. It has elevated its valuation from $5 billion to an impressive range of $5.4 billion to $5.5 billion.
What sets this funding round apart is its strategic timing. Ola Electric has been diligently gearing up for its forthcoming initial public offering (IPO). To fuel its ambitious growth plans, the company has actively engaged with investment bankers, with the ultimate aim of achieving a substantial valuation of $10 billion through the IPO. The primary objective of the IPO is to generate net proceeds amounting to $1 billion. Industry insiders have hinted at a potential timeline, suggesting that Ola Electric is poised to file its draft red herring prospectus (DRHP) by the conclusion of the next quarter, setting the stage for a much-anticipated IPO launch by the end of the current fiscal year.
One notable aspect of Ola Electric’s journey is its distinguished list of major shareholders. Among them are globally renowned entities such as Temasek, SoftBank, Tiger Global Management, Edelweiss, Matrix Partners India, Kia Motors, and Alpha Wave Investors. Interestingly, some of these investors have expressed an interest in divesting a portion of their stakes in the company during the IPO.
Ola Electric’s most recent funding round has elevated the firm to the forefront of India’s expanding e-scooter sector. It is similar to its earlier success in January 2022 when it won a massive $200 million from investors. With a 32% market share, Ola Electric has risen to the top despite the competition from Ather, TVS and Hero. Impressively, the company recorded robust sales figures, with approximately 95,000 e-scooters sold between April and August 2023.
While the company has showcased its market dominance, it has also reported an operating loss of $136 million in the fiscal year of March 2023. Its total revenue amounted to $335 million, as per reports from Reuters. However, with the recent capital injection, Ola is now better equipped to solidify its position in the competitive e-scooter sector. As it moves closer to its eagerly awaited IPO later this year, the company remains well-positioned for further expansion and innovation in the field of electric mobility.