
Ola Electric, India's leading electric two-wheeler manufacturer, saw its shares surge by as much as 10.8% during its public debut on Friday, marking the largest listing among Indian companies in two years. The Bengaluru-based firm, backed by SoftBank and Temasek, saw its shares rise to 84.21 rupees ($1), surpassing the upper price band of 76 rupees. The company had filed for an IPO at a valuation 26% lower than the $5.4 billion it reached in an October 2023 funding round, and significantly below the initially targeted range of $6.5 billion to $8 billion.
Ola Electric dominates India's electric two-wheeler market, holding a 46% market share in the fiscal year 2025 to date, although this dropped to 39% in July. The company, which launched its first electric scooter in December 2021, sold over 330,000 units in the financial year ending March. Despite its success, the company is not yet profitable, with revenues of 50 billion rupees ($626.3 million), an EBITDA loss of 13 billion rupees ($162.8 million), and a net loss of 16 billion rupees ($200.5 million) during the same period.
Ola Electric’s strategic plans include developing its own battery cell technology and expanding its manufacturing capabilities, aiming to increase capacity to 20GWh by the second quarter of 2026. This move toward vertical integration is expected to give the company better control over quality, supply, and costs.
India's electric vehicle market is expected to grow significantly, with Macquarie predicting a gradual increase in electric two-wheeler market penetration to 7%, 10%, 13%, and 16% for fiscal years 2025, 2026, 2027, and 2028, respectively. However, Ola Electric’s prospectus offers a more optimistic view, forecasting a penetration rate of 41-56% by fiscal year 2028. The recent reduction in government subsidies for electric two-wheelers has affected the sector’s growth, but the Indian EV market is seeing increased consolidation. The Herfindahl-Hirschman Index (HHI), which measures market concentration, rose from 1,200-1,330 in fiscal years 2022-2023 to 2,810 in the June quarter, exceeding the 2,160 figure for traditional internal combustion engine two-wheelers.
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