Ola Electric, a prominent player in the electric vehicle (EV) industry, has secured a substantial investment of Rs 3,200 crore (approximately $385 million) in a recent funding round comprising equity and debt contributions. This remarkable infusion of capital comes from esteemed investors led by Temasek and India’s largest bank, State Bank of India (SBI).
The capital injection marks a significant milestone for Ola Electric and signifies its commitment to expanding its electric vehicle business in India. A vital component of the company’s expansion plans is establishing India’s first lithium-ion cell manufacturing facility, set to be located in Krishnagiri, Tamil Nadu.
The lithium-ion cell manufacturing facility will begin its operations with an initial production capacity of 5-gigawatt hours during its first phase, with plans to scale up production to an impressive 100 gigawatt hours at total capacity. This bold move will undoubtedly contribute to India’s growth as an EV production and technology hub.
Ola Electric, known primarily for its electric scooters, is diversifying its product portfolio by introducing a line of electric motorcycles, with a planned launch by the end of the year. This expansion into the motorcycle segment highlights the company’s ambition to cater to a broader audience and establish a stronger foothold in the electric two-wheeler market.
Over the past few months, Ola Electric has successfully attracted investments in multiple tranches, with a substantial portion of the funds coming from investors like Temasek, Blue Investments, DIG Investments, Tiger Global, Tekne Private Ventures, and Ashutosh Vinayak Joshi, amounting to $300 million as reported by Entrackr in early October.
According to estimates by TheKredible, the company’s valuation has surged to approximately Rs 44,410 crore, equivalent to $5.4 billion, after the latest funding round. This valuation represents significant growth from the $5 billion valuation the company held in January last year.
This recent infusion of capital pushes Ola Electric’s total funds raised, encompassing both equity and debt, beyond the $1 billion mark, underlining the confidence of investors in the company’s growth potential and its role in transforming the Indian EV landscape.
As for ownership and critical stakeholders, SoftBank remains the most significant external stakeholder with a 23.6% share, followed by investors like Tiger Global, Matrix, and others. Founder and CEO of Ola Electric, Bhavish Aggarwal, held a significant 36.6% stake in the company before the Series E financing round.
Ola Electric’s closest rival, Ather Energy, also made headlines recently by securing $108 million in funding from its existing investors, GIC and Hero MotoCorp. This influx of capital demonstrates the overall optimism surrounding the electric mobility sector in India.
While Ola Electric has yet to release its annual report for FY23, the company posted operating revenue of Rs 373 crore during FY22, a substantial increase from Rs 0.86 crore in FY21. However, the rapid expansion and investment in manufacturing capabilities resulted in higher expenses, causing the company to report losses of Rs 784 crore in FY22, indicating the significant investment plans to drive India’s electric vehicle industry forward.
In conclusion, Ola Electric’s successful fundraising efforts and ambitious plans for expansion, including establishing India’s first lithium-ion cell manufacturing facility, are significant for the company and India’s burgeoning electric vehicle sector. This substantial investment reinforces investors’ confidence and underscores Ola Electric’s pivotal role in India’s transition to sustainable, eco-friendly transportation solutions.
