Company Overview
Ola Electric Mobility Limited, a prominent player in the electric vehicle (EV) industry, focuses on producing electric vehicles and essential components like battery packs, motors, and vehicle frames at its advanced Ola Futurefactory.
Product Launches and Announcements
Ola Electric has been active in expanding its product line since August 2021. Here's a timeline of their key product launches and announcements:
- December 2021: Debut of the Ola S1 Pro, their first electric vehicle model.
- Subsequent Years: Introduction of the Ola S1, Ola S1 Air, Ola S1 X, and Ola S1 X+.
- August 15, 2023: Unveiling of new EV models along with a lineup of motorcycles, including the Diamondhead, Adventure, Roadster, and Cruiser.
Distribution Network
As of October 31, 2023, Ola Electric has established a robust omnichannel distribution network across India, which includes:
- Experience Centers: 870 locations
- Service Centers: 431 centers (429 of which are within experience centers)
- Online Presence: A dedicated website for Ola Electric
Export and Domestic Supply
In the fiscal year 2023:
- Ola Electric accounted for about 75% of India's two-wheeler (2W) exports, with major markets being Africa, Latin America (LATAM), and Southeast Asia.
- The domestic supply of electric two-wheelers (E2W) remained limited.
Business Model
Ola Electric's business strategy is built on three scalable platforms:
- R&D and Technology Platform: Focusing on in-house design and development of EV technologies and components.
- Adaptable Production and Supply Chain Platform
- D2C Omnichannel Sales Platform
Objectives of the IPO
The funds raised from the IPO will be used for:
- Capital expenditure
- Repayment or pre-payment of debt
- Investment in research and development of new products
- General corporate purposes
Key Risks and Concerns
- Competitive Market: The intense competition in the EV market may lead to pricing pressures, necessitating price reductions for EVs, which could impact profitability and the overall business.
- Financial Performance: Ola Electric has reported losses over the past three fiscal years (FY22, FY23, and FY24). Specifically, the company experienced a loss of Rs. 784 crore in FY22, which increased to Rs. 1,584 crore in FY24.
Summary of Financial Information:
| Period Ended | 31-Mar-24 | 31-Mar-23 | 31-Mar-22 | 31-Mar-21 |
|---|---|---|---|---|
| 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 |
Comparison with Listed Peers:
| Company Name | P/E | P/B | RoE (%) |
|---|---|---|---|
| Ola Electric Mobility Ltd | -18.00 | 14.00 | - |
| TVS Motor Company Ltd | 70.00 | 17.00 | 29 |
| Eicher Motors Ltd | 34.00 | 8.00 | 21.00 |
| Bajaj Auto Ltd | 33.00 | 9.00 | 27 |
| Hero MotoCorp Ltd | 29.00 | 6.00 | 22 |
Key details of the IPO:
IPO Dates: 2 Aug to 6 Aug, 2024
Price Band: Rs. 72 to Rs. 76 per share
Lot Size: 195 shares
Listing Date: 9 Aug, 2024
Total Issue Size: Rs. 6145.56 Cr. (Fresh Issue = Rs. 5500 Cr. )
Retail Quota: 10%
GMP: Rs. 9 (Only for information purposes.)
Note: For additional information & risk factors please refer to the Red Herring Prospectus
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Disclaimer: We are not SEBI registered. All the views are personal and only for educational purposes. Do your due diligence before making any trading or investing decisions. The data provided in this blog post is for illustrative purposes only and does not constitute financial advice. Always consult with a qualified financial advisor before making investment decisions.
