Ola Electric IPO opens: Check lot size, price band, analyst insights and more

Ola IPO: Ola Electric Mobility, led by Bhavish Aggarwal, has launched its Initial Public Offering (IPO) worth Rs 6,166 crore. The IPO opened on Friday, August 2, and includes a mix of fresh issues and an offer for sale. The Bengaluru-based electric vehicle manufacturer will issue 72.37 crore fresh shares, raising Rs 5,500 crore, and an offer for sale of 8.49 crore shares, amounting to Rs 645.56 crore.

The IPO will remain open until August 6, with the final allotment expected by Wednesday, August 7. The company is scheduled to list on the BSE and NSE, with a tentative listing date of Friday, August 9.

The price band for the IPO has been set between Rs 72 and Rs 76 per share. The minimum lot size for retail investors is 195 shares, requiring a minimum investment of Rs 14,820 at the upper end of the price band. Small non-institutional investors (sNII) must invest in at least 14 lots, totalling 2,730 shares and costing Rs 207,480. For big non-institutional investors (bNII), the minimum investment is 68 lots, comprising 13,260 shares, for a total of Rs 1,007,760.

Analysts from Sharekhan have highlighted the IPO as a unique opportunity in India's emerging EV market. Ola Electric is a leader in the domestic electric two-wheeler segment, offering investors a chance to capitalize on the growing EV sector. Despite reporting EBITDA losses, the company's gross margin and revenue have shown an upward trend, coinciding with increased production volumes since FY22. The analysts believe that the company's operating performance could improve further with rising volumes, cost optimization, and potential benefits from the Production Linked Incentive (PLI) scheme. At the upper price band, the company is valued at 6.7 times its projected FY24 sales.

However, the analysts also noted some risks associated with the IPO, including Ola Electric's limited operating history, negative cash flows from operations, quality issues, and potential market disruptions. Despite these challenges, Ola Electric's focus on research and technology, development of supply chain capabilities, and efforts to build EV hubs and improve cell technology are seen as significant strengths.

Ola Electric, headquartered in Bengaluru, Karnataka, operates a manufacturing facility in Krishnagiri, Tamil Nadu. The company delivered its first electric vehicle, the Ola S1 Pro, in December 2021, followed by the Ola S1 in September 2022. In August 2023, the Ola S1 Air was introduced, and December 2023 saw the launch of the Ola S1 X+. In May 2024, Ola released three new models: the Ola S1 X (2 kWh), Ola S1 X (3 kWh), and Ola S1 X (4 kWh).

On August 15, 2023, Ola announced a new lineup of motorcycles, featuring four models: Diamondhead, Adventure, Roadster, and Cruiser, which are expected to be delivered in the first half of FY26.