BENGALURU – Ola Electric Mobility, India’s top electric scooter manufacturer backed by SoftBank, saw its shares surge by 10% on their trading debut on August 9, pushing the company’s valuation to an impressive 369.45 billion rupees (S$5.8 billion).
The stock opened at its initial offer price of 76 rupees on the National Stock Exchange, in line with a broader market rise of 1%. Ola Electric’s initial public offering (IPO) of US$734 million, the largest in India for 2024, attracted bids worth approximately US$1.8 billion earlier this week.
Since launching its first model just three years ago, Ola Electric has swiftly captured 39% of the Indian electric scooter market. Despite the rapid growth in revenue, the company has yet to turn a profit. In the fiscal year ending March 2024, Ola Electric’s sales increased by 90% compared to the previous year, but its losses also widened by 8%.
The company plans to invest the majority of its approximately US$660 million proceeds from the IPO into research and development and the establishment of its own battery cell manufacturing unit. Ola Electric’s strategy to achieve profitability hinges on producing its own battery cells, which it believes will significantly reduce the cost of its scooters. The company aims to begin commercial production of these battery cells by early 2025.