Bhavish Aggarwal's Ola Electric to raise Rs 5500 crore, to launch its IPO on...

The date of the much-awaited IPO of Ola Electric Mobility has been announced. The electric two-wheeler company led by Bhavish Aggarwal will float its initial public offering (IPO) on August 2. The initial share sale will conclude on August 6. The price band of the company's maiden public issue will be announced on Monday.

The prospectus showed that the company's proposed IPO combines a fresh issue of equity shares up to Rs 5,500 crore and an offer for sale (OFS) of 8.49 crore equity shares by promoters and investors. Under the OFS, Ola Electric founder Bhavish Aggarwal will offload almost 3.8 crore shares. The bidding for anchor investors will open for a day on August 1, according to the red herring prospectus (RHP).

A significant part of the proceeds will be used for capacity expansion of its cell manufacturing plant and revving up R&D. For Ola Electric, the IPO will provide the much-needed impetus to invest in enhancing cell manufacturing capacity and research and development on future technologies and products.

According to its prospectus, Ola Electric plans to utilise Rs 1,227.6 crore out of the proceeds of its Rs 5,500 crore public issue on capacity expansion of its cell manufacturing plant to 6.4 GWh from 5 GWh. The company is also looking to use Rs 1,600 crore from the fresh fund on research and product development, another Rs 800 crore will be deployed to repay debts and Rs 350 crore for organic growth initiatives.

READ | Meet man who once worked as salesman, now set to acquire Rs 13630 crore company, his net worth is...

In its RHP, the company said that Phase 1 (a) and Phase 1 (b) of the set-up and expansion of the Ola Gigafactory at Krishnagiri district in Tamil Nadu will be funded from internal accruals and long-term borrowings availed by its arm Ola Cell Technologies Pvt Ltd (OCT).

(With inputs from PTI)