Ola Electric IPO Fully Subscribed Amid High Retail and Non-Institutional Demand

The Rs 6,145-crore IPO of Ola Electric Mobility was fully subscribed on the second day of bidding. Demand was driven by retail and non-institutional investors. The company plans to use the proceeds for manufacturing capacity expansion, research and product development, and debt repayment.

The Rs 6,145-crore initial public offer of electric two-wheeler company Ola Electric Mobility was fully subscribed by the second day of bidding, propelled by high demand from retail and non-institutional investors.

According to NSE data, the IPO received bids for 49,43,63,610 shares against 46,51,59,451 shares on offer, translating to 1.06 times subscription. The category for Retail Individual Investors (RIIs) achieved 2.87 times subscription, while the quota for non-institutional investors got subscribed 1.11 times. Qualified Institutional Buyers (QIBs) received 40 percent subscription.

The Initial Public Offering (IPO), which includes a fresh issue of up to Rs 5,500 crore and an Offer for Sale (OFS) of up to 8,49,41,997 equity shares, is priced between Rs 72 and Rs 76 per share. Ola Electric founder Bhavish Aggarwal is offloading nearly 3.8 crore shares as part of the OFS.

The proceeds from the IPO will allow Ola Electric to invest significantly in boosting its cell manufacturing capacity from 5 GWh to 6.4 GWh, enhancing research and development, and repaying debts. Specifically, Rs 1,227.6 crore will be used for capacity expansion, Rs 1,600 crore for R&D, Rs 800 crore for debt repayment, and Rs 350 crore for organic growth initiatives.

Ola Electric’s expansion efforts, including Phase 1(a) and Phase 1(b) of the Ola Gigafactory in Tamil Nadu's Krishnagiri district, will be funded through internal accruals and long-term borrowings by its subsidiary, Ola Cell Technologies Pvt Ltd.

Additionally, the company secured Rs 2,763 crore from anchor investors such as SBI Mutual Fund, HDFC Mutual Fund, and Goldman Sachs.