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Ola Electric Mobility Ltd

Ola Electric Mobility Ltd IPO

Status: Closed

Overview

IPO date

02 Aug 2024 to 06 Aug 2024

Face value

₹ 10 per share

Price

₹ 72 to ₹76 per share

Issue Size

808,626,208 shares
(aggregating up to ₹ 6145.56 Cr)

Allotment Date

07 Aug 2024

Listing at

NSE

Issue type

Book Building

Sector

Automobile

Objectives of Ola Electric Mobility Ltd IPO

initial public offering of 808,699,624# equity shares of face value of Rs. 10 each of Ola Electric Mobility Limited (The "Company" or the "Company") for cash at a price of Rs. 76 per equity share (including a premium of Rs. 66 per equity share) ("Offer Price") aggregating to Rs. 6145.56#^ crores (the "Offer") comprising a fresh issue of 723,757,627# equity shares of face value of Rs. 10 each aggregating to Rs. 5500.00#^ crores (the "Fresh Issue") and an offer for sale of 84,941,997# equity shares of face value of Rs. 10 each aggregating to Rs. 645.56# crores (the "Offer for Sale"), consisting of 37,915,211# equity shares of face value of Rs. 10 each aggregating to Rs. 288.16# crores by Bhavish Aggarwal, 4,178,996# equity shares of face value of Rs. 10 each aggregating to Rs. 31.76# crores by Indus Trust, 295,470# equity shares of face value of Rs. 10 each aggregating to Rs. 2.25# crores by AB Initio Capital, l.p., 3,782,883# equity shares of face value of Rs. 10 each aggregating to Rs. 28.75# crores by Alpha Wave Ventures ii, lp, 630,336# equity shares of face value of Rs. 10 each aggregating to Rs. 4.79# crores by Alpine opportunity fund vi, l.p., 601,828# equity shares of face value of Rs. 10 each aggregating to Rs. 4.57# crores by Ashna Advisors llp, 6,360,891# equity shares of face value of Rs. 10 each aggregating to Rs. 48.34# crores by internet fund iii pte ltd, 1,354,978# equity shares of face value of Rs. 10 each aggregating to Rs. 10.30# crores by macritchie investments pte. ltd., 89,000# equity shares of face value of Rs. 10 each aggregating to Rs. 0.67# crores by matrix partners india iii aif trust, 3,727,534# equity shares of face value of Rs. 10 each aggregating to Rs. 28.33# crores by matrix partners india investments iii, llc, 358,228# equity shares of face value of Rs. 10 each aggregating to Rs. 2.72# crores by Nuvama Private investments trust-nuvama crossover opportunities fund - series iii, 278,619# equity shares of face value of Rs. 10 each aggregating to Rs. 2.12# crores by nuvama private investments trust-nuvama crossover opportunities fund - series iii a, 278,644# equity shares of face value of Rs. 10 each aggregating to Rs. 2.12# crores by nuvama private investments trust-nuvama crossover opportunities fund - series iii b, 256,530# equity shares of face value of Rs. 10 each aggregating to Rs. 1.95# crores by sarin family india llc, 23,857,268# equity shares of face value of Rs. 10 each aggregating to Rs. 181.32# crores by svf ii ostrich (de) llc and 975,581# equity shares of face value of Rs. 10 each aggregating to Rs. 7.41# crores by tekne private ventures xv, ltd. (collectively, the "selling shareholders" and such equity shares, the "Offered Shares"). The offer included a reservation of 797,101# equity shares of face value of Rs. 10 each, aggregating to Rs. 5.50#^ crores (constituting 0.02% of the post-offer paid-up equity share capital, for subscription by eligible employees ("Employee Reservation Portion"). The offer less the employee reservation portion is hereinafter referred to as the "Net Offer". The offer and the net offer constitutes 18.33% and 18.32% of the post-offer paid-up equity share capital of the company, respectively. #Subject to finalisation of basis of allotment. ^After employee discount. %A discount of Rs. 7 per equity share was offered to eligible employees bidding in the employee reservation portion.

Ola Electric Mobility Ltd IPO Strategy

About Ola Electric Mobility Ltd

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T&C*

Strengths vs Risks of Ola Electric Mobility Ltd

Know the pros & cons

Strengths

Pure EV player with a leadership position in the fast-growing Indian E2W market.
Founder led company supported by a highly experienced and professional leadership team.
In-house R&D and technology capabilities.
Manufacturing at scale and supply chain resilience.
Scalable platform-based design and development approach.
Direct to customer omnichannel distribution model.
Eligibility for EV-related government incentives leading to cost advantages.
Execution excellence.

Risks

The company, including its Material Subsidiaries, Ola Electric Technologies Private Limited ("OET") and Ola Cell Technologies Private Limited ("OCT"), have incurred losses and negative cash flows from operations since inception.
The company has a limited operating history in manufacturing EVs. There is no assurance that the company will be cost effective in its operations or profitable in the future, whether at the holding company level or at the subsidiary level.
The company has heavily invested in and plan to continue investing in research and development ("R&D") and technology. There is no assurance that its will realise returns on such investments.
The company could experience disruptions in the supply or an increase in prices of components and raw materials used in the manufacture of its electric vehicles, which could result in an increase in the price of its electric vehicles and impact the company projected manufacturing and delivery timelines.
Any reduction or elimination of government incentives or the ineligibility of any of its electric vehicles for such incentives would increase the retail price of the company electric vehicles and could adversely affect customer demand for its electric vehicles and affect the company ability to achieve profitability.
The company could experience supply constraints, increased prices and quality issues in the supply of raw materials used in cell manufacturing, which could adversely affect cell manufacturing at its Ola Gigafactory and the quality of the cells produced therefrom.
The company design and develop certain core electric vehicle components in-house and procure certain electric vehicle components from foreign and domestic suppliers. If its electric vehicles, electric vehicle components or raw materials used in the manufacture of the company's electric vehicles contain defects or have quality issues, or if its electric vehicles does not perform as per industry standards and/or fail to meet the performance levels advertised, its brand, reputation and ability to develop, market and sell its electric vehicles could be adversely impacted.
If the company vehicles become ineligible for the EMPS 2024 subsidy its may become less competitive due to higher product pricing (without the subsidies), potentially impacting its business and financial performance.
If the company is unable to claim government incentives under the PLI Schemes or the PLI Schemes are discontinued, its may become less competitive due to higher product pricing (without the subsidies), potentially impacting its business, profitability and financial performance.
The company intend to utilize Rs. 16,000 million out of the Net Proceeds for investment into research and development purposes of the Company, which constitutes a significant portion of the Net Proceeds which the company propose to raise pursuant to the Offer. Its cannot assure you that such investment into research and development will proceed as planned and result in creation of tangible assets or achieve results as anticipated.
The company intend to utilize Rs. 12,276.41 million of the Net Proceeds to fund its capital expenditure requirements to expand the Ola Gigafactory's manufacturing capacity. The company has relied on the quotations received from third parties in estimating such capital expenditure requirements and such project has not been appraised by any bank or financial institution or any other independent agency. Additionally, the company has also relied on the D&B Report, which provides certain risks in relation to construction of the Ola Gigafactory.
The company may not be able to protect its intellectual property rights and prevent the unauthorised use of its intellectual property, which could harm the company's business and competitive position. Further, the company may not be able to protect its brand name `Ola' as the company does not own the trademark for it.
Its may faces various risks that could hinder the company in-house cell manufacturing capabilities at the Ola Gigafactory.
The company currently derive its revenue solely from the sale of limited electric vehicle scooter models, if its electric vehicle scooters are not well-received by the market, the company's business could be adversely affected.
The company is yet to complete a full warranty cycle in respect of its EVs. The company warranty reserves may be insufficient to cover future warranty claims, which could adversely affect its financial condition and results of operations.
In case of any failures to achieve the agreed upon capacity each year as prescribed under the Cell PLI Scheme and the Programmer Agreement, the Government of India has the right to deduct twice the shortfall in the committed capacity from the total subsidy payable to issuer.
Its success dependss on the company ability to successfully develop, introduce, manufacture, market and deliver new electric vehicle models of high quality on schedule and on a large scale, which may expose it to new and increased challenges and risks.
Due to the competitive market in which the company operates in, its may faces downward pricing pressures that may require the company to reduce the prices of its EVs. A reduction in pricing may in turn lead to reduced profitability which would adversely impact its business, prospects and results of operations.
Its may not be able to compete successfully in the highly competitive and fast evolving automotive market.
The company is required to provide financing to its Material Subsidiary, OCT, and the company may not have sufficient free cash reserves to finance OCT.
Its Ola Futurefactory had a capacity utilisation rate of 49% in Fiscal 2024. Low capacity utilisation of its Ola Futurefactory may limit the company ability to leverage economies of scale.
The expansion of its existing Ola Futurefactory facility and production capacity may be subject to delays, disruptions, cost overruns, or may not produce the expected benefits and thus could adversely affect its production capacity, financial condition, and results of operation.
Its may not be able to accurately estimate the supply and demand for the company electric vehicles leading to either a shortage or excess in inventory, which in turn could prevent it from effectively managing its manufacturing requirements, resulting in additional costs and production delays.
Its customers have access to a limited number of charging stations. If the company is unable to expand its charging infrastructure to maintain an appropriate ratio of charging stations to customers, demand for its electric vehicles could be adversely affected.
Its funding requirements and the proposed deployment of Net Proceeds are based on management estimates and the company has not entered into any definitive arrangements to utilise certain portions of the Net Proceeds of the Offer.
The lack of interoperability of its and other EV players' charging infrastructures may deter potential customers from purchasing its EVs.
Its business depends substantially on the continued efforts of its Key Managerial Personnel, Senior Management and other qualified personnel. The company experienced high employee attrition rates in the past and may experience similar attrition rates in the future, which may impact its operations.
If the company has contingent liabilities in the future, and they materialise, it may affect its results of operations, financial condition and cash flows. While the company had no contingent liabilities as at March 31, 2024, its had capital commitments of Rs.4,473.81 million as at such date.
The company has entered into, and will continue to enter into, related party transactions that may involve conflicts of interest.
The Reserve Bank of India ("RBI") has taken certain actions in the past against Ola Financial Services Private Limited ("OFSPL"), which is a Promoter Group entity and a Group Company.
The functioning of its EVs is highly dependent on the health and functioning of the company batteries. If customers perceive the cost of replacement of batteries in its EVs to be high, they may choose not to purchase the company EVs.
The cost of acquisition of Equity Shares of the Company by its Promoter, Bhavish Aggarwal, is negligible.
The failures of its EVs to meet the performance and quality levels promised may result in product recalls or legal actions against it. This could adversely affect its brand image in the company target market and the company's business, prospects, financial condition, results of operations and cash flows.
If the company is not able to attract and retain customers, its business, prospects, financial condition, results of operations, and cash flows would be materially harmed.
The expansion of its experience centres may not lead to a commensurate increase in sales of the company's EVs thus adversely affecting its business, prospects, financial condition, results of operations and cash flows.
Inadequate access to public charger guns could cause customers to faces difficulties in recharging their EVs, particularly during long distance travels, and in turn, materially and adversely affect demand for its electric vehicles.
Technology is critical to its business operations and growth prospects. Any failures in the company's technology, including errors, bugs, vulnerabilities or design defects, or any failures on its part to address such issues or improve or effectively utilise its technology could cause delays in the launch of the company electric vehicles and harm its business operations, reputation and growth prospects.
Its electric vehicles make use of lithium-ion cells, and if such cells catch fire or vent smoke and flames, its could be subject to adverse publicity and the company's brand, business, financial condition, results of operations and prospects could be harmed.
The company has received customer complaints pertaining to product quality in the past. The company cannot assure you that its will not receive such similar complaints in the future or that its will be able to address such customer complaints in a timely manner or at all.
Its internet led distribution model is different from the predominant current distribution model for automobile manufacturers. The company's ability to successfully implement its distribution model will significantly impact the company's business, operating results and future prospects.
Some of its competitors have a wider distribution network than it, which may provide them with a competitive edge.
The network of repair and servicing centres for EVs is not as developed as compared to ICE vehicles which may deter customers from purchasing EVs.
Its may not succeed in continuing to establish, maintain and strengthen the Ola brand and its reputation and brand could be harmed by complaints and negative publicity which could materially and adversely affect customer acceptance of its electric vehicles and the company's business revenue and prospects.
Customers may cancel their pre-orders or orders for its electric vehicles despite their deposit payment and online confirmation, thus harming its business, prospects, financial condition and results of operations.
The driving range on a single charge of its electric vehicles declines over time which may negatively influence potential customers' decisions whether to purchase its electric vehicles. The company is yet to fully ascertain the deterioration rate of its batteries as the company batteries have not completed a full lifecycle.
There have been certain delays in reporting matters relating to downstream investments by its Subsidiaries, OEC, OCT and OET, and options granted to non-resident director by the Company as required under the Foreign Exchange Management (Non-Debt Instruments) Rules, 2019 ("NDI Rules") in the past. Consequently, its may be subject to regulatory actions and penalties fees for such non-compliance which may adversely impact its financial condition. Compounding application was filed by the Company for delay in filing Form ESOP, for certain options issued to its Directors which was disposed of.
Its borrowings have increased in the past three Fiscals. Such borrowings impose certain restrictive covenants on it. Any future failures to meet the conditions under its financing arrangements or obtain any consents thereunder could have significant consequences on its business and operations.
The company will requires a significant amount of capital which its may be unable to obtain on favourable terms or at all. In addition, the company future capital needs may requires it to obtain additional loans and borrowings or issue additional equity or debt securities that may contain restrictive covenants that limit its operations or the company's ability to pay dividends, or in the case of an issuance of securities, dilute its shareholders.
Its Promoter, Bhavish Aggarwal is a shareholder of a company engaged in a line of business similar to its. Additionally, the company Promoter, Director, Group Companies, members of Promoter Group and Subsidiaries have a conflict of interest with lessor of the immovable properties (crucial for operations of the Company) and suppliers of raw materials and third party service providers (crucial for operations of the Company). Any conflict of interest which may occur as a result could adversely affect its business, prospects, results of operations and financial condition.
Its Founder, Chairman and Managing Director, Bhavish Aggarwal is a promoter of the Company, ANI Technologies Private Limited, one of its Promoter Group companies and its group company and Krutrim SI Designs Private Limited, another of the company Promoter Group companies, all of which have incurred losses and negative cash flows from operations.
If electric vehicle owners customise its electric vehicles or change the charging infrastructure with aftermarket products, the electric vehicle may not operate properly which could harm its business.
There are environmental hazards associated with the manufacturing of EVs and the discharge of batteries used in our EVs, as the EV cells used in our EVs are not designed to be repaired or recycled.
Its EV batteries are charged with power generated through non-renewable sources. Such use of non- renewable energy sources may not be environmentally sustainable.
Its electric vehicles are subject to motor vehicle standards as laid down by the Automotive Research Association of India and any changes in such standards or failures to satisfy such standards could materially and adversely affect its business and results of operations.
The company is subject to various environmental, health and safety laws and regulations that could impose substantial costs upon it.
Its may be unable to renew the company existing leases or secure new leases for its existing manufacturing facilities and offices.
There are pending litigations against the Company, Promoter, Subsidiaries, and certain of its Directors. Any adverse decision in such proceedings may render it/them liable to liabilities/penalties and may adversely affect its business, cash flows and reputation.
Breaches in data security, failures of information security systems and privacy concerns could adversely impact its financial condition, subject it to penalties, damage the company reputation and brand, and harm its business, prospects, results of operations and cash flows.
Its Statutory Auditors' examination report on the Restated Consolidated Financial Information includes an observation towards reporting under Rule 11(g) of the Companies (Audit and Auditors) Rules, 2014 related to the feature of recording audit trail (edit log) facility in the respective softwares by the Company and its subsidiaries incorporated in India. If such observations are included in future audit reports or examination reports, the trading price of the Equity Shares may be adversely affected.
Its Promoter, Directors, Key Managerial Personnel and Senior Management have interests in the Company in addition to their remuneration and reimbursement of expenses.
Its Material Subsidiary, Ola Electric Technologies Private Limited has availed loans from banks and other financial institutions, which may be recalled on demand.
A portion of the Net Proceeds is proposed to be utilised for repayment or pre-payment, in full or part, all or a portion of certain loans availed by its Subsidiaries from Axis Bank Limited and Bank of Baroda, affiliates of certain BRLMs to the Offer.
Its may in the future become, subject to patent, trademark and/or other intellectual property infringement claims, which may be time-consuming, cause it to incur significant liability and increase the company costs of doing business.
Its use of open source software in the company applications could subject its proprietary software to general release, adversely affect its ability to sell its services and subject it to possible litigation, claims or proceedings.
If the company does not or fails to obtain, renew, or maintain the statutory and regulatory permits and approvals required to operate its business, it could have a material adverse effect on the company's business. Approval of Ola Electric Technologies' application made to the Office of the Deputy Director, District Town & Country Planning is currently pending as of the date of this Red Herring Prospectus.
The company relies primarily on third-party insurance policies to insure its operations -related risks. If its insurance coverage is inadequate, it may have an adverse effect on the company's business, financial condition and results of operations.
The activities carried out at its Ola Future factory and its Ola Gigafactory can cause injury to people or property in certain circumstances.
The company has used information from the Redseer Report which its commissioned for industry related data in this Red Herring Prospectus and any reliance on such information is subject to inherent risks.
The company track certain operational metrics with internal systems and tools and does not independently verify such metrics. Certain of its operational metrics are subject to inherent challenges in measurement and any real or perceived inaccuracies in such metrics may adversely affect its business and reputation.
Its results of operations may vary significantly from period to period due to the seasonality of its business and fluctuations in the company operating costs.
If the company cannot maintain its culture as the company grow, its could lose the innovation, teamwork, and passion that its believe contribute to the company's success and its business may be harmed.
Its may be subject to risks associated with strategic alliances or acquisitions.
Its business may be adversely affected by labour unrest and union activities.
The company will faces risks associated with potential international operations, including unfavourable regulatory, political, currency, tax, and labour conditions, which could harm its business, prospects, financial condition, results of operations, and cash flows.
The company is subject to risks associated with exchange rate fluctuations.
Its ability to pay dividends in the future will depends on its earnings, financial condition, working capital requirements, capital expenditures and restrictive covenants of our financing arrangements.
Its ability to invest in foreign subsidiaries or joint ventures is constrained by applicable restrictions under Indian overseas investment laws as well as laws of the relevant international jurisdictions, which could adversely affect its business prospects and international growth strategy.
The company has not been able to obtain records of the prior work experience of one of its Directors to supplement his past work experience and therefore limited disclosure has been made for his profile in this Red Herring Prospectus.
There were certain instances of delays in payment of statutory dues by it. Future delays in payment of statutory dues could attract financial penalties or other regulatory actions from the respective government authorities and in turn adversely affect its financial condition and cash flows.
The Company has undertaken bonus issuances in the past by utilizing securities premium account.

Ola Electric Mobility Ltd Peer Comparison

Understand the company’s industry standing

Ola Electric Mobility Ltd

TVS Motor Company Ltd

Eicher Motors Ltd

Face Value

Standalone / Consolidated

Consolidated

Total Income Rs. Cr.

---

EPS-Basis

-4.35

35.5

146.18

EPS-Diluted

-4.35

35.5

145.92

NAV Per Share

5.54

158.1

659.06

P/E-Basic EPS

---

70.24

32.04

P/E-Diluted EPS

---

RONW(%)

-78.46

23.68

22.17

Latest NAV Period

---

Latest NAV

---

How to check the allotment status of Ola Electric Mobility Ltd IPO?

Follow the steps

Open link to the registrar using this URL (https://evault.kfintech.com/ipostatus/).

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The IPO opens on 02 Aug 2024 & closes on 06 Aug 2024.

Ola Electric Mobility Ltd was incorporated as 'Ola Electric Mobility Private Limited' at Bengaluru, Karnataka as a private limited company under the Companies Act, 2013, pursuant to a certificate of incorporation dated February 3, 2017. Subsequently, the Company was converted to a public limited company and the name of the Company changed to 'Ola Electric Mobility Limited', pursuant to a Shareholders' resolution dated October 5, 2023 and a fresh certificate of incorporation dated November 17, 2023. The company is a pure EV player in India and is building vertically integrated technology and manufacturing capabilities for EVs and EV components, including cells. The company manufactures EVs and certain core EV components like battery packs, motors and vehicle frames at the Ola Futurefactory. The companies business focuses on capturing the opportunity arising out of electrification of mobility in India and we also seek opportunities to export our EVs in select international markets in the future. The company has delivered four products and additionally announced six new products since the first product announcement in August 2021. The company commenced delivery of its first EV model, the Ola $1 Pro, in December 2021. This was followed by the delivery of the Ola $1 in September 2022, the Ola S1 Air in August 2023 and the Ola S1 X+ in December 2023. On August 15, 2023, the company announced other new EV scooter models, the Ola S1 X (2 kWh) and the Ola S1 X (3 kWh), in addition to the Ola S1 X+, as well as a line-up of motorcycles comprising four models, Diamondhead, Adventure, Roadster and Cruiser. The company plans to commence delivery of the Ola S1 X (2 kWh) and the Ola S1 X (3 kWh) by the first half of Fiscal 2025 and the motorcycles in the first half of Fiscal 2026.

Ola Electric Mobility Ltd IPO will close on 06 Aug 2024.

Pure EV player with a leadership position in the fast-growing Indian E2W market.
Founder led company supported by a highly experienced and professional leadership team.
In-house R&D and technology capabilities.
Manufacturing at scale and supply chain resilience.
Scalable platform-based design and development approach.
Direct to customer omnichannel distribution model.
Eligibility for EV-related government incentives leading to cost advantages.
Execution excellence.

S.No	Promoters Name	Pre Issue Shares	Pre Issue Percentage	Post Issue Shares	Post Issue Percentage
1	Bhavish Aggarwal	1361875240	36.94	---	---
2	ANI Technologies Pvt Ltd	160413177	4.35	---	---
3	Indus Trust	141959272	3.85	---	---
4	Naresh Kumar Aggarwal	165669	---	---	---

The company, including its Material Subsidiaries, Ola Electric Technologies Private Limited ("OET") and Ola Cell Technologies Private Limited ("OCT"), have incurred losses and negative cash flows from operations since inception.
The company has a limited operating history in manufacturing EVs. There is no assurance that the company will be cost effective in its operations or profitable in the future, whether at the holding company level or at the subsidiary level.
The company has heavily invested in and plan to continue investing in research and development ("R&D") and technology. There is no assurance that its will realise returns on such investments.
The company could experience disruptions in the supply or an increase in prices of components and raw materials used in the manufacture of its electric vehicles, which could result in an increase in the price of its electric vehicles and impact the company projected manufacturing and delivery timelines.
Any reduction or elimination of government incentives or the ineligibility of any of its electric vehicles for such incentives would increase the retail price of the company electric vehicles and could adversely affect customer demand for its electric vehicles and affect the company ability to achieve profitability.
The company could experience supply constraints, increased prices and quality issues in the supply of raw materials used in cell manufacturing, which could adversely affect cell manufacturing at its Ola Gigafactory and the quality of the cells produced therefrom.
The company design and develop certain core electric vehicle components in-house and procure certain electric vehicle components from foreign and domestic suppliers. If its electric vehicles, electric vehicle components or raw materials used in the manufacture of the company's electric vehicles contain defects or have quality issues, or if its electric vehicles does not perform as per industry standards and/or fail to meet the performance levels advertised, its brand, reputation and ability to develop, market and sell its electric vehicles could be adversely impacted.
If the company vehicles become ineligible for the EMPS 2024 subsidy its may become less competitive due to higher product pricing (without the subsidies), potentially impacting its business and financial performance.
If the company is unable to claim government incentives under the PLI Schemes or the PLI Schemes are discontinued, its may become less competitive due to higher product pricing (without the subsidies), potentially impacting its business, profitability and financial performance.
The company intend to utilize Rs. 16,000 million out of the Net Proceeds for investment into research and development purposes of the Company, which constitutes a significant portion of the Net Proceeds which the company propose to raise pursuant to the Offer. Its cannot assure you that such investment into research and development will proceed as planned and result in creation of tangible assets or achieve results as anticipated.
The company intend to utilize Rs. 12,276.41 million of the Net Proceeds to fund its capital expenditure requirements to expand the Ola Gigafactory's manufacturing capacity. The company has relied on the quotations received from third parties in estimating such capital expenditure requirements and such project has not been appraised by any bank or financial institution or any other independent agency. Additionally, the company has also relied on the D&B Report, which provides certain risks in relation to construction of the Ola Gigafactory.
The company may not be able to protect its intellectual property rights and prevent the unauthorised use of its intellectual property, which could harm the company's business and competitive position. Further, the company may not be able to protect its brand name `Ola' as the company does not own the trademark for it.
Its may faces various risks that could hinder the company in-house cell manufacturing capabilities at the Ola Gigafactory.
The company currently derive its revenue solely from the sale of limited electric vehicle scooter models, if its electric vehicle scooters are not well-received by the market, the company's business could be adversely affected.
The company is yet to complete a full warranty cycle in respect of its EVs. The company warranty reserves may be insufficient to cover future warranty claims, which could adversely affect its financial condition and results of operations.
In case of any failures to achieve the agreed upon capacity each year as prescribed under the Cell PLI Scheme and the Programmer Agreement, the Government of India has the right to deduct twice the shortfall in the committed capacity from the total subsidy payable to issuer.
Its success dependss on the company ability to successfully develop, introduce, manufacture, market and deliver new electric vehicle models of high quality on schedule and on a large scale, which may expose it to new and increased challenges and risks.
Due to the competitive market in which the company operates in, its may faces downward pricing pressures that may require the company to reduce the prices of its EVs. A reduction in pricing may in turn lead to reduced profitability which would adversely impact its business, prospects and results of operations.
Its may not be able to compete successfully in the highly competitive and fast evolving automotive market.
The company is required to provide financing to its Material Subsidiary, OCT, and the company may not have sufficient free cash reserves to finance OCT.
Its Ola Futurefactory had a capacity utilisation rate of 49% in Fiscal 2024. Low capacity utilisation of its Ola Futurefactory may limit the company ability to leverage economies of scale.
The expansion of its existing Ola Futurefactory facility and production capacity may be subject to delays, disruptions, cost overruns, or may not produce the expected benefits and thus could adversely affect its production capacity, financial condition, and results of operation.
Its may not be able to accurately estimate the supply and demand for the company electric vehicles leading to either a shortage or excess in inventory, which in turn could prevent it from effectively managing its manufacturing requirements, resulting in additional costs and production delays.
Its customers have access to a limited number of charging stations. If the company is unable to expand its charging infrastructure to maintain an appropriate ratio of charging stations to customers, demand for its electric vehicles could be adversely affected.
Its funding requirements and the proposed deployment of Net Proceeds are based on management estimates and the company has not entered into any definitive arrangements to utilise certain portions of the Net Proceeds of the Offer.
The lack of interoperability of its and other EV players' charging infrastructures may deter potential customers from purchasing its EVs.
Its business depends substantially on the continued efforts of its Key Managerial Personnel, Senior Management and other qualified personnel. The company experienced high employee attrition rates in the past and may experience similar attrition rates in the future, which may impact its operations.
If the company has contingent liabilities in the future, and they materialise, it may affect its results of operations, financial condition and cash flows. While the company had no contingent liabilities as at March 31, 2024, its had capital commitments of Rs.4,473.81 million as at such date.
The company has entered into, and will continue to enter into, related party transactions that may involve conflicts of interest.
The Reserve Bank of India ("RBI") has taken certain actions in the past against Ola Financial Services Private Limited ("OFSPL"), which is a Promoter Group entity and a Group Company.
The functioning of its EVs is highly dependent on the health and functioning of the company batteries. If customers perceive the cost of replacement of batteries in its EVs to be high, they may choose not to purchase the company EVs.
The cost of acquisition of Equity Shares of the Company by its Promoter, Bhavish Aggarwal, is negligible.
The failures of its EVs to meet the performance and quality levels promised may result in product recalls or legal actions against it. This could adversely affect its brand image in the company target market and the company's business, prospects, financial condition, results of operations and cash flows.
If the company is not able to attract and retain customers, its business, prospects, financial condition, results of operations, and cash flows would be materially harmed.
The expansion of its experience centres may not lead to a commensurate increase in sales of the company's EVs thus adversely affecting its business, prospects, financial condition, results of operations and cash flows.
Inadequate access to public charger guns could cause customers to faces difficulties in recharging their EVs, particularly during long distance travels, and in turn, materially and adversely affect demand for its electric vehicles.
Technology is critical to its business operations and growth prospects. Any failures in the company's technology, including errors, bugs, vulnerabilities or design defects, or any failures on its part to address such issues or improve or effectively utilise its technology could cause delays in the launch of the company electric vehicles and harm its business operations, reputation and growth prospects.
Its electric vehicles make use of lithium-ion cells, and if such cells catch fire or vent smoke and flames, its could be subject to adverse publicity and the company's brand, business, financial condition, results of operations and prospects could be harmed.
The company has received customer complaints pertaining to product quality in the past. The company cannot assure you that its will not receive such similar complaints in the future or that its will be able to address such customer complaints in a timely manner or at all.
Its internet led distribution model is different from the predominant current distribution model for automobile manufacturers. The company's ability to successfully implement its distribution model will significantly impact the company's business, operating results and future prospects.
Some of its competitors have a wider distribution network than it, which may provide them with a competitive edge.
The network of repair and servicing centres for EVs is not as developed as compared to ICE vehicles which may deter customers from purchasing EVs.
Its may not succeed in continuing to establish, maintain and strengthen the Ola brand and its reputation and brand could be harmed by complaints and negative publicity which could materially and adversely affect customer acceptance of its electric vehicles and the company's business revenue and prospects.
Customers may cancel their pre-orders or orders for its electric vehicles despite their deposit payment and online confirmation, thus harming its business, prospects, financial condition and results of operations.
The driving range on a single charge of its electric vehicles declines over time which may negatively influence potential customers' decisions whether to purchase its electric vehicles. The company is yet to fully ascertain the deterioration rate of its batteries as the company batteries have not completed a full lifecycle.
There have been certain delays in reporting matters relating to downstream investments by its Subsidiaries, OEC, OCT and OET, and options granted to non-resident director by the Company as required under the Foreign Exchange Management (Non-Debt Instruments) Rules, 2019 ("NDI Rules") in the past. Consequently, its may be subject to regulatory actions and penalties fees for such non-compliance which may adversely impact its financial condition. Compounding application was filed by the Company for delay in filing Form ESOP, for certain options issued to its Directors which was disposed of.
Its borrowings have increased in the past three Fiscals. Such borrowings impose certain restrictive covenants on it. Any future failures to meet the conditions under its financing arrangements or obtain any consents thereunder could have significant consequences on its business and operations.
The company will requires a significant amount of capital which its may be unable to obtain on favourable terms or at all. In addition, the company future capital needs may requires it to obtain additional loans and borrowings or issue additional equity or debt securities that may contain restrictive covenants that limit its operations or the company's ability to pay dividends, or in the case of an issuance of securities, dilute its shareholders.
Its Promoter, Bhavish Aggarwal is a shareholder of a company engaged in a line of business similar to its. Additionally, the company Promoter, Director, Group Companies, members of Promoter Group and Subsidiaries have a conflict of interest with lessor of the immovable properties (crucial for operations of the Company) and suppliers of raw materials and third party service providers (crucial for operations of the Company). Any conflict of interest which may occur as a result could adversely affect its business, prospects, results of operations and financial condition.
Its Founder, Chairman and Managing Director, Bhavish Aggarwal is a promoter of the Company, ANI Technologies Private Limited, one of its Promoter Group companies and its group company and Krutrim SI Designs Private Limited, another of the company Promoter Group companies, all of which have incurred losses and negative cash flows from operations.
If electric vehicle owners customise its electric vehicles or change the charging infrastructure with aftermarket products, the electric vehicle may not operate properly which could harm its business.
There are environmental hazards associated with the manufacturing of EVs and the discharge of batteries used in our EVs, as the EV cells used in our EVs are not designed to be repaired or recycled.
Its EV batteries are charged with power generated through non-renewable sources. Such use of non- renewable energy sources may not be environmentally sustainable.
Its electric vehicles are subject to motor vehicle standards as laid down by the Automotive Research Association of India and any changes in such standards or failures to satisfy such standards could materially and adversely affect its business and results of operations.
The company is subject to various environmental, health and safety laws and regulations that could impose substantial costs upon it.
Its may be unable to renew the company existing leases or secure new leases for its existing manufacturing facilities and offices.
There are pending litigations against the Company, Promoter, Subsidiaries, and certain of its Directors. Any adverse decision in such proceedings may render it/them liable to liabilities/penalties and may adversely affect its business, cash flows and reputation.
Breaches in data security, failures of information security systems and privacy concerns could adversely impact its financial condition, subject it to penalties, damage the company reputation and brand, and harm its business, prospects, results of operations and cash flows.
Its Statutory Auditors' examination report on the Restated Consolidated Financial Information includes an observation towards reporting under Rule 11(g) of the Companies (Audit and Auditors) Rules, 2014 related to the feature of recording audit trail (edit log) facility in the respective softwares by the Company and its subsidiaries incorporated in India. If such observations are included in future audit reports or examination reports, the trading price of the Equity Shares may be adversely affected.
Its Promoter, Directors, Key Managerial Personnel and Senior Management have interests in the Company in addition to their remuneration and reimbursement of expenses.
Its Material Subsidiary, Ola Electric Technologies Private Limited has availed loans from banks and other financial institutions, which may be recalled on demand.
A portion of the Net Proceeds is proposed to be utilised for repayment or pre-payment, in full or part, all or a portion of certain loans availed by its Subsidiaries from Axis Bank Limited and Bank of Baroda, affiliates of certain BRLMs to the Offer.
Its may in the future become, subject to patent, trademark and/or other intellectual property infringement claims, which may be time-consuming, cause it to incur significant liability and increase the company costs of doing business.
Its use of open source software in the company applications could subject its proprietary software to general release, adversely affect its ability to sell its services and subject it to possible litigation, claims or proceedings.
If the company does not or fails to obtain, renew, or maintain the statutory and regulatory permits and approvals required to operate its business, it could have a material adverse effect on the company's business. Approval of Ola Electric Technologies' application made to the Office of the Deputy Director, District Town & Country Planning is currently pending as of the date of this Red Herring Prospectus.
The company relies primarily on third-party insurance policies to insure its operations -related risks. If its insurance coverage is inadequate, it may have an adverse effect on the company's business, financial condition and results of operations.
The activities carried out at its Ola Future factory and its Ola Gigafactory can cause injury to people or property in certain circumstances.
The company has used information from the Redseer Report which its commissioned for industry related data in this Red Herring Prospectus and any reliance on such information is subject to inherent risks.
The company track certain operational metrics with internal systems and tools and does not independently verify such metrics. Certain of its operational metrics are subject to inherent challenges in measurement and any real or perceived inaccuracies in such metrics may adversely affect its business and reputation.
Its results of operations may vary significantly from period to period due to the seasonality of its business and fluctuations in the company operating costs.
If the company cannot maintain its culture as the company grow, its could lose the innovation, teamwork, and passion that its believe contribute to the company's success and its business may be harmed.
Its may be subject to risks associated with strategic alliances or acquisitions.
Its business may be adversely affected by labour unrest and union activities.
The company will faces risks associated with potential international operations, including unfavourable regulatory, political, currency, tax, and labour conditions, which could harm its business, prospects, financial condition, results of operations, and cash flows.
The company is subject to risks associated with exchange rate fluctuations.
Its ability to pay dividends in the future will depends on its earnings, financial condition, working capital requirements, capital expenditures and restrictive covenants of our financing arrangements.
Its ability to invest in foreign subsidiaries or joint ventures is constrained by applicable restrictions under Indian overseas investment laws as well as laws of the relevant international jurisdictions, which could adversely affect its business prospects and international growth strategy.
The company has not been able to obtain records of the prior work experience of one of its Directors to supplement his past work experience and therefore limited disclosure has been made for his profile in this Red Herring Prospectus.
There were certain instances of delays in payment of statutory dues by it. Future delays in payment of statutory dues could attract financial penalties or other regulatory actions from the respective government authorities and in turn adversely affect its financial condition and cash flows.
The Company has undertaken bonus issuances in the past by utilizing securities premium account.

The Issue type of Ola Electric Mobility Ltd is Book Building.

The minimum application for shares of Ola Electric Mobility Ltd is 195.

The total shares issue of Ola Electric Mobility Ltd is 808626208.

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