SoftBank-backed Ola Electric expected to set a valuation of approximately $4.5 billion for its upcoming initial public offering (IPO), which represents a decrease of about 16-20% compared to its valuation in the last funding round, according to Reuters report.
In June, the Indian markets regulator greenlit Ola's $660 million stock market debut, marking the first IPO by an electric vehicle manufacturer in India and poised to become one of the country's largest share offerings this year.
Ola Electric's last funding round in September, led by Singapore's investment firm Temasek, valued the company at $5.4 billion. However, sources indicate that this valuation is expected to decrease this time, reflecting a broader "recalibration" in global tech stock valuations.
The source further said that the overall valuations in the market have corrected, noting that while the final valuation could still vary, it is unlikely to approach the at least $6 billion target hoped for by Ola Electric's founder Bhavish Aggarwal for the IPO.
A second source suggested that Ola Electric intends to set a lower valuation to ensure the IPO is attractively priced, providing an opportunity for investors to generate returns.
India is currently experiencing a surge in IPO activity, buoyed by its near-record-high stock markets. Benchmark Indian indices have doubled from 2019 to 2023, with the country's stock market surpassing Hong Kong earlier this year to become the world's fourth-largest. Hyundai Motor from South Korea also plans to list its India unit, aiming for a valuation of up to $30 billion with an IPO expected to raise up to $3 billion.
In December last year, Ola Electric revised down its sales targets for 2023-2025 by more than half and postponed its profitability goal by a year due to reduced government incentives that led to higher e-scooter prices. Despite this, its revenue from operations surged more than sevenfold, while the consolidated loss widened to ₹14.72 billion ($176.14 million) for the fiscal year ended March 2023.
