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Ola Electric, the SoftBank-backed electric scooter manufacturer, is set to launch its Initial Public Offering (IPO) in India, attracting significant interest from institutional investors. Fidelity, Nomura, and Norway's Norges Bank have all expressed interest in participating in the IPO's anchor book, where they are allocated shares before the public subscription opens. Fidelity is reportedly planning to bid around $75 million, while Nomura and Norges are aiming for $100 million each. Several Indian mutual funds, including SBI, HDFC, UTI, and Nippon India, have also committed to placing bids, with their combined total exceeding $700 million.
The IPO is expected to be one of the largest in India this year, with Ola Electric aiming to raise $660 million through the issuance of new shares. Additionally, existing investors, including founder Bhavish Aggarwal, will offload a stake worth approximately $80 million to IPO investors. The total allocation for anchor investors is set at $330 million. While initial reports suggested a valuation of $4.2-4.4 billion for the company, recent sources indicate a lower valuation of $4 billion to $4.2 billion. This adjusted valuation reflects the current global tech market correction and Ola's desire to ensure broad participation in the IPO.
The lower valuation represents a 22% to 26% discount compared to Ola's last funding round in September, which was led by Singapore's Temasek and valued the company at $5.4 billion. The IPO announcement comes amidst a surge in capital markets activity in India, with stock markets reaching record highs. The strong investor interest in Ola Electric's IPO highlights the growing demand for electric vehicles and the potential of the Indian market. However, the lower valuation reflects the global trend of tech companies experiencing corrections in their market values.
Source: Fidelity, Nomura line up bids for Ola Electric's IPO