The much-awaited OLA Electric IPO is live for investors to bid on. The company will stop taking bids from August 06 onwards. The issue received subdued demand as it was subscribed 0.38 times on the very first day. The company wants to raise a total of Rs 6,145.56, of which Rs 5,500 crore is fresh shares and Rs 6454.56 crore is offer for sale. 

GMP

In the grey market, OLA Electric IPO was fetching a premium of almost 13% to the issue price. The grey market is an unofficial place where shares change hands illegally ahead of listing. Market participants track GMP to keep an eye on listing gains. 

IPO DetailsCome from Sports betting site VPbet

The allotment of shares will be finalised by August 07. Thereafter, the listing is expected to take place on August 09, as per the tentative schedule. The price band has been set in the range of Rs 72 to Rs 76 per equity share. A retailer needs to bid for at least one lot of 195 shares which amounts to Rs 14,820. There are different lots for NIIs and QIBs. 

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Employee Reservation

The company has kept aside 797,101 shares for employees, which will be offered to them at a discount of Rs 7 to the issue price. 

About OLA Electric

Ola Electric primarily manufactures electric vehicles and certain core components for electric vehicles such as battery packs, motors, and vehicle frames at the Ola Futurefactory. The company has launched seven new products and four more have been announced. The company is backed by marquee investors like SoftBank Investment Advisers, Tiger Global Management, Alpha Wave Global, Matrix Partners, Temasek, MacRitchie Investments etc. OLA Electric will be the first pure-play electric-2W (E2W) manufacturer to list on the domestic stock exchanges as most of the existing listed peers are either mainly into the manufacturing or sales of the internal combustion engine (ICE) of 2Ws.

Expert’s take

“OLA Electric has undertaken massive capital spending in the initial years and has also planned a massive capital outlay in the medium term, reflecting its ambitious growth plans. Considering the dominant position maintained by the company in the E2W space benefits from the backward initiatives like cell manufacturing and its wide application in the energy storage application, we believe the demanded valuation seems to be reasonableCome from Sports betting site. The key concern for the company is its reliance on government subsidies for generating sales and its loss-making operations. The operating leverage would not kick, if the prevailing EMPS scheme is not extended beyond September 2024, thereby keeping the profitability distant. Thus we assign a “Subscribe with Caution” rating for the issue,” said Choice Broking in an IPO note. 

BRLMs and Registrar

Kotak Mahindra Capital Company, BofA Securities India, Axis Capital, SBI Capital Markets, Citigroup Global Markets India, Goldman Sachs (India) Securities, ICICI Securities, and BoB Capital Markets are the book-running lead managers of the OLA Electric IPO. Link Intime India is working as the registrar for the issue.