Bangalore-based Ola Electric Mobility (Ola Electric) shares made their market debut on August 9 and have soared over 40% since their first day of trading to above INR109 ($1.3) per share compared to its listing price of INR76. The shares have now twice hit market "circuit breakers" of a maximum daily 20% share rise.
It was the first initial public offering (IPO) by an electric vehicle (EV) manufacturer in India; and the first IPO by an automaker in India in around 20 years. Founded in 2017, Ola Electric specialises in the production of EVs, building vertically integrated technology and manufacturing capabilities for EVs and EV components, including cells, for two-wheeler vehicles.
The IPO commenced on August 2 and concluded on August 6. The IPO allotment was fixed on August 7 and the Ola Electric share price listing date was on Friday, August 9.
Ola Electric's shares were listed on both the BSE (formerly the Bombay Stock Exchange) and the National Stock Exchange of India (NSE); both exchanges are based in Mumbai. The book running lead managers on the transaction included Kotak Mahindra Capital, Citigroup Global Markets India Private, BofA Securities India, Goldman Sachs (India) Securities Private, Axis Capital, ICICI Securities, SBI Capital Markets and BOB Capital Markets.
Arvind Vashistha, Citi’s India head of equity capital markets, told FinanceAsia: “The success of this transaction reiterates that the Indian IPO market is open for large capital raising activity and remains robust despite global market volatility.”
Vashistha added: “This is the largest equity IPO in India year-to-date and the first IPO of a 'pure-play' EV company in India, and saw significant interest from both domestic and foreign institutional investors. Over 90% of the anchor tranche was allocated to long only investors – which saw participation from global mutual funds, sovereign wealth funds, insurance companies, alternative investment funds and alternate asset managers.”
Linklaters helped advise on the deal, which was led by partner and head of India practice Amit Singh, with support from counsel Jospeh Wolpin and associate Rushil Oberoi. The law firm said, in a media release, that the IPO generated significant interest and received strong demand from domestic and international investors.
In addition to a large manufacturing plant in India in Krishnagiri, Tamil Nadu, Ola Electric has research and development facilities across India, the UK and the US.
The company was founded by entrepreneur Bhavish Aggarwal, who owns 36.78% of the firm.
Brainbees Solutions
Another one of Ola Electric's backers is Japan's SoftBank Group, which within the space of week has seen another one of its Indian companies, Brainbees Solutions (Brainbees), also list on the NSE and BSE.
On August 13, Brainbees raised around INR42 billion, or $500 million, with shares priced at INR465 each -- the top end of its price band. Shares at one stage climbed over 50% on its trading debut.
Other investors in the business included the Singapore government, Fidelity International, Goldman Sachs and the Abu Dhabi Investment Authority, in addition to several large insurers.
The loss-making firm, which operates under the brand FirstCry, sells consumer products for mothers, babies and kids online and in stores.
Kotak Mahindra Capital Company, Morgan Stanley India, BofA Securities India, JM Financial and Avendus Capital were the book running lead managers for the IPO. Global US law firm Sidley Austin advised and represented Brainbees, with partner Manoj Bhargava and counsel Shashwat Tewary leading its team.
Brainbees plans to use the proceeds to build a new facility and warehouse in India, invest in its subsidiary, and cover lease payments.
Indian firms have raised over $6.5 billion in initial share sales so far this year, according to data compiled by Bloomberg. India's equity capital markets saw record activity in Q1 2024.
