IPO-bound Ola Electric raises Rs 410 crore in debt from Evolution X

IPO-bound Ola Electric Mobility, which battles with Ather Energy, has raised Rs 410 crore or approximately $50 million through non-convertible debentures from EvolutionX Debt Capital.

The debt comes as part of Ola Electric's broader strategy to strengthen its position in the electric vehicle (EV) sector. EvolutionX is a DBS and Temasek-backed firm that is known for backing prominent internet companies.

Ola Electric's previous funding

The latest round of debt financing is not Ola Electric's first foray into securing funds through debt instruments. Just six months prior, the company had raised $240 million from the State Bank of India, contributing to a larger $384 million financing round that also saw equity funding from Temasek.

The funding comes as Ola Electric is focused on boosting its expansion plans, including its venture into lithium-ion cell manufacturing and the introduction of new EV models. 

Preparing for the mega IPO launch

In late December last year, Ola Electric filed its draft red herring prospectus (DRHP) with the Securities and Exchange Board of India (SEBI). The company is aiming to raise up to Rs 5,500 crore through a fresh issue, alongside an offer-for-sale component, eyeing a valuation of $7-8 billion for its upcoming initial public offering (IPO).

The IPO comprises a fresh issue of equity shares and an offer for sale (OFS) of up to 95.2 million shares. Bhavish Aggarwal, the company's promoter, along with Indus Trust and other major investors like Alpha Wave, Alpine Opportunity, Tiger Global, and SoftBank, will participate in the OFS.

Aggarwal is set to divest 47.4 million shares, making him the largest seller in the OFS. While Bhavish Aggarwal is the single largest shareholder in the company, SoftBank is the largest external shareholder with a 21.98% stake, followed by Tiger Global, which holds a 6.03% share. ANI Technologies, Indus Trust, and Alpha Wave have stakes of 4.35%, 3.85%, and 3.49%, respectively.

Matrix Partners, Hyundai, and Temasek own 3.43%, 2.95%, and 3.02% of the shares in the company, respectively.

Investing in Ola Electric Technologies

Ola Electric also plans to invest Rs 500 crore into its wholly-owned subsidiary, Ola Electric Technologies Pvt Ltd (OET), which plays a crucial role in Ola's EV ecosystem. 

Last month, It was reported that Ola Electric is planning to launch an electric three-wheeler vehicle called Raahi, which will compete with established models like the Bajaj RE, Piaggio Ape e-city, and Mahindra Treo. The vehicle will enter the electric three-wheeler segment before Ola's IPO.