Bhavish Aggarwal may cash in Rs 288-cr gain from Ola Electric IPO; Details

Bhavish Aggarwal currently holds 36.94 per cent of the issued, subscribed, and paid-up equity share capital of the company on a fully diluted basis

Ola Electric IPO: Bhavish Aggarwal-led, Ola Electric Mobility Limited, which commands nearly 35 per cent market share in India's electric two-wheeler market, is scheduled to open its initial public offering (IPO) for subscription on Friday, August 2, 2024. The Softbank-backed Ola Electric aims to raise around Rs 6,145.56 crore from the IPO. This is expected to be India's biggest initial public offering of 2024 so far.

Available at a price band of Rs 72-76 per share and a lot size of 195 shares, the Ola Electric IPO comprises 723,684,210 equity shares worth approximately Rs 5,500 crore. The net proceeds will be utilised to repay debt, expand its gigafactory, fund organic growth initiatives, and support research and product development, with the remaining proceeds allocated for general corporate purposes.

 

The IPO also includes an offer for sale, with the promoters and investors offloading 84,941,997 shares with a face value of Rs 10, aggregating to Rs 645.56 crore.

Bhavish Aggarwal to gain Rs 288 Cr from Ola Electric IPO

Among the promoters, Bhavish Aggarwal and Indus Trust will offload 37,915,211 and 4,178,996 equity shares with a face value of Rs 10 each, respectively. According to the Red Herring Prospectus, Aggarwal currently holds 1,361,875,240 equity shares with a face value of Rs 10 each in the company, representing 36.94 per cent of the issued, subscribed, and paid-up equity share capital of the company on a fully diluted basis. The average cost of acquisition per equity share for Aggarwal is negligible, as per the RHP papers.

If the shares are issued at the upper end of the IPO price band, which is Rs 76, this will yield earnings of nearly Rs 288.15 crore (37,915,211 shares sold multiplied by the IPO price of Rs 76) from the public issue.

Here's what the RHP papers say about the average cost of acquisition per equity share for Bhavish Aggarwal:

"As of the date of this Red Herring Prospectus, our Promoter, Bhavish Aggarwal, holds 1,361,875,240 equity shares with a face value of Rs 10 each in our company, representing 36.94 percent of the issued, subscribed, and paid-up equity share capital of our company on a fully diluted basis. ANI Technologies Private Limited (Ola Cabs) was allotted 9,999 equity shares with a face value of Rs 10 each at a price of Rs 10 per equity share pursuant to the initial subscription to the Memorandum of Association on February 3, 2017. Subsequently, on December 19, 2018, Ola Cabs transferred 9,250 equity shares with a face value of Rs 10 each held by it to our Promoter, Bhavish Aggarwal, for an aggregate consideration of Rs 92,500. On December 23, 2021, our Company made an allotment of 1,955,439,944 equity shares with a face value of Rs 10 each as a bonus to such shareholders of our Company, whose names appeared on the list of beneficial owners on the record date, i.e., December 23, 2021, including our Promoter, Bhavish Aggarwal, who was allotted 1,377,660,870 equity shares with a face value of Rs 10 each pursuant to this bonus issue. Other than the acquired shares purchased on December 19, 2018, there has been no further acquisition of equity shares by our Promoter in our Company, except for the allotment of bonus shares. On this account, the cost of acquisition of equity shares by our Promoter, Bhavish Aggarwal, is negligible."

Investors offloading stakes in Ola Electric

Here is the list of investors selling their stakes in the Ola Electric through offer for sale:

• Alpha Wave Ventures II, LP - Up to 3,782,883 equity shares
• Alpine Opportunity Fund VI, L.P. - Up to 630,336 equity shares
• Internet Fund III Pte Ltd - Up to 6,360,891 equity shares
• MacRitchie Investments Pte. Ltd - Up to 1,354,978 equity shares
• Matrix Partners India Investments III, LLC - Up to 3,727,534 equity shares
• SVF II Ostrich (DE) LLC - Up to 23,857,268 equity shares
• Tekne Private Ventures XV, Ltd - Up to 975,581 equity shares
• Ashna Advisors LLP - Up to 601,828 equity shares