Bhavish Aggarwal-led Ola raises $139 mn, valuation crosses over $7 bn

IPO-bound mobility platform Ola has raised about $139 million from few investors including IIFL, Edelweiss, and Sunil Munjal-led Hero Enterprise, show regulatory documents sourced from business intelligence platform Tofler. Bhavish Aggarwal-led Ola has been valued at about $7.3 billion.

Ola has allocated 4,63,471 Series J1 Compulsorily Convertible Preference Shares (CCPS) at a premium price of Rs 22,625 per share, as per the filings. It may be pre-IPO financing round, according to the analysts, as the firm is preparing to file its draft IPO documents.

Hero Enterprise has invested about Rs 112 crore. Edelweiss has invested about Rs 250 crore. IIFL has invested about Rs 187 crore. Media platform Inc42 first reported this development.

Ola has also allotted shares worth Rs 100 crore to former Zandu promoters Parikh family and Siddhant Partners. Ola has also allotted shares worth Rs 50 crore to Biovet, an animal health vaccine maker. Vicco Group has been allotted shares worth Rs 10 crore. Also shares worth Rs 13 crore have been allotted to Famy Care Group's Ashutosh Taparia and Sanjeev Taparia.

The filing also showed that the SoftBank-backed firm paid Rs 26 crore to acquire geospatial services provider GeoSpoc. In October this year, Ola said it has acquired Pune-based GeoSpoc, a leading provider of geospatial services. GeoSpoc co-founder Dhruva Rajan and his team of Geospatial scientists and engineers had joined Ola to develop technologies that will make mobility universally accessible, sustainable, personalised, and convenient, across shared and personal vehicles

The new funding comes at a time when Ola’s transportation business has been badly hit by the pandemic. However, sources said that while Covid-19 brought its business down, it used the pandemic to improve its unit economics.

In July this year, Ola, said Temasek and Plum Wood Investment Ltd, an affiliate of Warburg Pincus, were partnering company founder Bhavish Aggarwal for a $500-million investment ahead of its initial public offering (IPO). Warburg Pincus was a new investor and Singapore-based Temasek, an existing investor since 2018, according to the sources. This was mainly a secondary transaction.

According to sources, in that financing round, Temasek and Warburg bought shares worth $500 million from two of Ola’s existing investors. They had said Tiger Global and Matrix Partners India, both of which hold 13-15 per cent in Ola, had sold shares in this round. Tiger Global has partially exited. Japan’s SoftBank had held 22 per cent and China's Tencent had about 9 per cent in Ola.

In another development, Ola Electric, the ride-hailing firm's electric vehicle arm, has also raised about Rs 398 crore from investors such as Paytm founder Vijay Shekhar Sharma’s VSS Investco and private equity firm DST Global's Rahul Mehta. Other such investors include IIFL, Edelweiss and Temasek, Singapore’s state-backed investment company

In October this year, Ola Electric, raised over $200 million led by Falcon Edge, Softbank and others, tripling its valuation to $3 billion. In July 2019, Ola Electric raised $250 million from Masayoshi Son’s SoftBank. It was just a two-year-old firm at that time. The investment made the fledgling venture a “unicorn”, or a start-up valued at more than $1 billion.

The funding is helping Ola to accelerate the development of other vehicle platforms including electric motorbike, mass-market scooter and its electric car. It is also helping it to strengthen Ola’s ‘Mission Electric’- which urges the industry and consumers to commit to electric and ensure that no petrol two-wheelers should be sold in India after 2025.

Ola Electric has built its Futurefactory. At full capacity of 10 million vehicles annually, it would be the world’s largest two-wheeler factory and would handle 15 per cent of the world capacity. It is also the world’s largest factory that is entirely run by women. At full scale, it will have over 10,000 women employed.