Ola Electric Mobility Pvt has experienced rapid growth in the electric scooter market, positioning the company for an initial public offering (IPO) sooner than anticipated. Since launching its electric scooters in late 2021, Ola Electric has captured a 38 percent market share of India’s EV sector. Founder and CEO Bhavish Aggarwal, acknowledging the company’s accelerated growth, now believes the IPO could be on the horizon much earlier than initially projected.
Aggarwal said, “Ola Electric has grown and matured faster than I had initially planned because the market response has been very strong.” The company’s success can be attributed to its impressive sales figures, having sold over 239,000 electric scooters since December 2021, as reported by the Society of Manufacturers of Electric Vehicles.
While the initial demand for Ola Electric scooters came from first-time scooter buyers, the company has seen a significant shift toward attracting existing EV enthusiasts. Aggarwal, dressed in a black Nehru jacket, shared his aspirations for expansion, including plans to unveil a motorbike by the end of 2023 and a battery-powered car in 2024. However, these timelines remain subject to change. Ola Electric also continues to explore export opportunities to Southeast Asia, Latin America, and Europe, which were temporarily put on hold due to robust domestic demand.
The company had previously contemplated an IPO, with reports in August 2021 suggesting that Ola Cabs had selected banks for a $1 billion IPO in Mumbai. However, no IPO materialized at that time. Aggarwal highlighted that Ola Electric is a profitable business, but he refrained from commenting on renewed listing attempts or providing a specific IPO date for Ola Electric.
To bolster its manufacturing capabilities, Ola Electric is constructing a sprawling 115-acre battery factory in southern India. The facility aims to produce lithium-ion cells primarily for Ola Electric vehicles and potentially offer energy storage and home energy solutions. Aggarwal believes that in-house manufacturing of EV components will enable Ola Electric to scale up its car production, increase profit margins, and exercise greater control over product quality and design. He emphasized that designing vehicles from scratch provides a competitive advantage in a market where most EVs are conversions from gasoline models.
Although India’s preference for combustion-engine vehicles and the lack of charging infrastructure have hindered EV adoption, Ola Electric is determined to overcome these challenges. The company faces stiff competition from established manufacturers such as Tata Motors, Mahindra & Mahindra, and the possibility of Elon Musk’s Tesla entering the Indian market.
Ola Electric has faced obstacles in its scooter business, including delivery delays caused by chip shortages and quality and fire-related issues. Sales declined by 39 per cent in June compared to the previous month, a trend that affected other automakers after government subsidies under the Faster Adoption and Manufacturing of (Hybrid and) Electric Vehicles program were reduced.
Ola Electric utilizes digital simulation and artificial intelligence in manufacturing to save time. He also stressed the company’s efficient decision-making process, facilitated by a flat organizational structure, enabling faster execution without compromising on quality or safety.
As Ola Electric’s journey unfolds, the potential IPO and its subsequent developments will be closely watched by industry observers and EV enthusiasts alike.
