Ola Electric IPO : A Comprehensive Analysis

Timeline

IPO Open Date:	August 2, 2024
IPO Close Date:	August 6, 2024
Basis of Allotment:	August 7, 2024
Refunds:	August 8, 2024
Credit to Demat Account:	August 8, 2024
IPO Listing Date:	August 9, 2024

About Company

Ola Electric Mobility Limited is a prominent player in India’s burgeoning electric vehicle (EV) industry. Established in 2017 as a subsidiary of ANI Technologies (Ola Cabs), the company has rapidly emerged as a leader in the electric two-wheeler segment.

Core Business:

• Electric Two-Wheeler Manufacturing: Ola Electric specializes in designing, manufacturing, and selling electric scooters.
• Battery Technology: The company is heavily invested in developing advanced battery technologies to enhance the performance and range of its electric vehicles.
• Charging Infrastructure: Ola Electric is building a comprehensive charging network to support its growing customer base and promote the adoption of electric mobility.

Key Highlights:

• India’s Largest Electric Two-Wheeler Factory: Ola Electric boasts the world’s largest two-wheeler factory in Krishnagiri, Tamil Nadu.
• Focus on Technology: The company emphasizes innovation and technology to deliver high-quality and feature-rich electric scooters.
• Government Support: Ola Electric has received significant support from the Indian government’s push towards electric mobility.

Market Position:

• Ola Electric has captured a significant market share in the Indian electric two-wheeler segment within a short span.
• The company’s aggressive pricing and innovative features have resonated well with the target audience.
• Ola’s strong brand recognition, backed by its parent company Ola Cabs, has contributed to its rapid growth.

Future Outlook:

• Ola Electric aims to expand its product portfolio beyond electric scooters to include other electric vehicles.
• The company is focused on strengthening its charging infrastructure to address range anxiety concerns.
• Global expansion is also on the cards for Ola Electric, with potential markets in Southeast Asia and Europe.

Here are some resources to learn more about company

• Read DRHP Here

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Objective

The Company proposes to utilise the Net Proceeds towards funding the following objects:

• Market Leadership: Ola Electric’s strong position in the burgeoning electric two-wheeler market.
• Growth Potential: The company’s expansion plans, including new product launches and manufacturing facilities, offer growth prospects.
• Government Support: The Indian government’s push for electric vehicles creates a favorable environment for the company.

POSITIVE

• Market Leadership: Ola Electric is a dominant player in the burgeoning electric two-wheeler segment, enjoying a strong brand presence and a loyal customer base.
• Growth Potential: The company’s expansion plans, including new product launches and manufacturing facilities, offer significant growth prospects.
• Government Support: India’s push towards electric mobility creates a favorable environment for Ola Electric’s operations.
• Technology Focus: The company’s emphasis on battery technology and charging infrastructure aligns with the future of electric mobility.

NEGATIVE

• Profitability Concerns: Ola Electric has reported substantial losses in recent years, raising concerns about its ability to achieve profitability in the near term.
• Intense Competition: The electric two-wheeler market is becoming increasingly competitive, with both established and new players vying for market share.
• Raw Material Costs: Fluctuations in battery prices and other raw materials can impact Ola Electric’s profitability.
• Charging Infrastructure Challenges: The development of a robust charging infrastructure is crucial for the success of electric vehicles. While Ola Electric is investing in this area, challenges remain

So,How Does Ola Electric IPO Fare in Terms of Financials ?

Financial Details

Period Ended	31 Mar 2024	31 Mar 2023	31 Mar 2022	31 Mar 2021
Assets	7,735.41	5,573.17	5,395.86	2,112.64
Revenue	5,243.27	2,782.70	456.26	106.08
Profit After Tax	-1,584.40	-1,472.08	-784.15	-199.23
Net Worth	2,019.34	2,356.44	3,661.45	1,970.62
Reserves and Surplus	-2,882.54	-1,380.03	-68.83	1,999.30
Total Borrowing	2,389.21	1,645.75	750.41	38.87
Amount in ₹ Cr

• Assets: Assets have shown significant growth over the past four years, indicating potential expansion or investment activities.
• Revenue: Revenue has increased substantially year-on-year, suggesting strong sales performance.
• Profitability: However, the company has reported significant losses in all four years, raising concerns about profitability. A more in-depth analysis is needed to understand the reasons behind the losses and the company’s plans for achieving profitability.
• Debt: The company has a high level of borrowing (₹ 2,389.21 crore) relative to its net worth (₹ 2,019.34 crore). This could be a cause for concern for potential investors.

Ola Electric IPO Valuation :

KPI	Values
ROE
ROCE
Debt/Equity
RoNW	-78.46%
P/BV	13.72
PAT Margin (%)

Ola Electric IPO – SWOT Analysis

Strengths

• Market Leadership: Ola Electric has established a strong foothold in the Indian electric two-wheeler market, with a significant customer base and brand recognition.
• Technology Focus: The company’s emphasis on cutting-edge battery technology and charging infrastructure positions it well for future growth.
• Manufacturing Scale: Ola Electric’s massive manufacturing facility offers cost advantages and production efficiency.
• Parent Company Support: The backing of Ola Cabs provides financial and operational support.

Weaknesses

• Profitability Concerns: The company has reported losses in recent years, raising questions about its ability to achieve profitability in the near term.
• Charging Infrastructure: While Ola is investing in charging infrastructure, the development of a robust network across India is still in its early stages.
• Supply Chain Challenges: Ensuring a stable supply of batteries and other components can be challenging, especially given the rapid growth of the electric vehicle market.

Opportunities

• Expanding Product Line: Ola Electric can diversify its product offerings to include electric three-wheelers, electric cars, or other electric mobility solutions.
• Global Expansion: The company can explore opportunities in international markets with growing demand for electric vehicles.
• Battery Technology Leadership: By further investing in battery technology, Ola can differentiate itself and gain a competitive advantage.

Threats

• Intense Competition: The electric two-wheeler market is becoming increasingly crowded, with both domestic and international players vying for market share.
• Government Policies: Changes in government policies related to subsidies, incentives, or regulations can impact the electric vehicle industry.
• Economic Downturns: Economic slowdown can affect consumer spending on discretionary items like electric vehicles.

COMPETITIVE ANALYSIS: MARKET PEERS

• Hero Electric: A pioneer in the Indian electric two-wheeler market with a strong distribution network.
• TVS Motor Company: A well-established player with a diverse product portfolio, including electric scooters.
• Bajaj Auto: A leading two-wheeler manufacturer expanding its electric vehicle offerings.
• Other emerging players: Several startups and traditional automakers are entering the electric two-wheeler space, increasing competition.

Ola Electric IPO GMP

• Grey market premium as on 06-08-2024 = Rs 1.50 / Share

Disclaimer:

• IPO Grey Market Premium (Ola Electric IPO GMP) mention is valid for the specific date as mentioned in the header.
• We are not buying and selling IPO forms on IPO Grey Market.
• Don’t decide to subscribe to an IPO just based on the initial price, as it can change before the listing.Subscribe only considering Fundamentals of the companies.

Ola Electric IPO

🔴 Live Subscription Status 🔴

06/08/2024 5:00 PM

	NO OF SHARES OFFERED	Day 1	Day 2	Day 3
Qualified Institutional Buyers(QIBs)	24,23,70,750	0.00	0.40	5.31
Non Institutional Investors(NIIs)	12,11,85,387	0.22	1.11	2.39
Retail Individual Investors(RIIs)	8,07,90,252	1.70	2.87	3.86
Employee	7,97,101	5.42	8.98	11.66
Total	44,51,43,490	0.38	1.06	4.26

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