SoftBank-backed Indian EV startup Ola Electric jumps 20% on debut, valuation standing at $4.8 billion

Shares of Ola Electric, the Indian electric vehicle startup backed by SoftBank, saw a notable increase of 20% on their market debut Friday, pushing the company’s valuation to approximately $4.8 billion.

Key Details

  • IPO Pricing: Ola Electric priced its shares at 76 rupees (91 cents) each, raising over $730 million in its initial public offering (IPO) in Mumbai. This IPO marks the largest listing in India for the year.
  • Share Performance: By 3:52 p.m. local time, shares were trading around 91.20 rupees.

Company Background

  • Product Line: Ola Electric specializes in electric scooters, with its first product launched only 2½ years ago. The company is now preparing to introduce its first electric motorbike in the latter half of 2025.
  • Market Position: Two-wheelers are the most popular form of transport in India. Electric two-wheelers are projected to make up 60% to 70% of all new scooter sales by 2030, according to McKinsey & Co. data. Ola Electric aims to capture this market trend.

Future Plans

  • Use of IPO Proceeds: The company plans to use the funds raised from the IPO to pay off debts, invest in research and development, and support the expansion of its gigafactory battery plant.
  • Expansion: While Ola Electric has not indicated plans to move into the car market, it is focusing on growing its presence in the two-wheeler segment.

Investors and Leadership

  • High-Profile Backers: The company has notable investors including SoftBank and Singapore’s Temasek.
  • Founder: Bhavish Aggarwal, the founder of Ola Electric, is also known for co-founding Ola Cabs, a major ride-hailing service in India.

Financials

  • Revenue and Losses: Ola Electric reported a 90% increase in revenue year-on-year for the year ending March 31. However, its losses have widened, and the company is still working towards profitability.