Ola Electric in 'giga' drive: Rs 3,200 crore to fund its EV business
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Ola Electric announced that it has secured about Rs 3,200 crore in funding as part of its equity and debt round. This funding was obtained from Temasek-led marquee investors and project debt from State Bank of India. The funding round, which includes equity, has raised the Bengaluru-based firm’s valuation to $5.5 billion, up from its previous valuation of $5 billion, according to sources.
The funds raised are expected to create an interim event and pave the way for an initial public offering (IPO), which may be in the range of $800 million to $1 billion.
A person familiar with the company’s strategy said, “Ola is planning to go public in the near future. The public offering is expected to be one of the largest automotive IPOs in India.” Sources indicate that other investors participating in the funding round alongside Temasek include DIG Investment and Tiger Global Management.
The raised funds will be utilised to expand Ola’s electric vehicle (EV) business and establish India’s first lithium-ion (Li-ion) cell manufacturing facility in Krishnagiri (Tamil Nadu).
These funds will also enable Ola Electric to accelerate the growth of its two-wheeler manufacturing capacity and facilitate the launch of electric motorcycles, followed by electric cars, and expedite the construction of the Gigafactory.
Bhavish Aggarwal, founder and chief executive officer of Ola Electric, said, “At Ola, our vision is to end the ICE (internal combustion engine) age in automobiles, and our upcoming Gigafactory will be a big leap in India’s journey towards becoming a global EV hub. We are committed to developing core technologies in EVs and cells and are rapidly scaling up manufacturing to accelerate the transition to sustainable mobility further. Our investors and lenders have shown deep faith in Ola’s vision.”
In January of the previous year, Ola Electric raised over $200 million from Tekne Private Ventures, Alpine Opportunity Fund, Edelweiss, and others, valuing the EV manufacturer at $5 billion.
In September 2021, Ola Electric raised $200 million led by Falcon Edge Capital, SoftBank, and others, at a valuation of $3 billion.
The company competes with Ather Energy, Okinawa Autotech, Ampere EV by Greaves, Hero Electric, and TVS Motor Company. It is also planning to produce electric cars, which will put the company in competition with Tata Motors and Mahindra & Mahindra, as well as global giants like Tesla and Hyundai. The company’s substantial investments in research and development and cell manufacturing are expected to underpin the success of its future products.
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