Ola Electric Reports Revenue Shortfall and $136M Loss in FY23
- ByStartupStory | July 29, 2023
Ola Electric, the leading electric vehicle maker, has recorded an operating loss of $136 million on revenue of $335 million in FY23, according to reports. Despite surpassing Rs 500 crore in revenue in the first two months of FY23 and setting ambitious internal projections, the company faced a revenue shortfall and is determined to achieve operational profitability this year.
The electric vehicle sector in India experienced recent events surrounding the FAME II scheme, which impacted incentives for electric vehicles. The government reduced the FAME II subsidy for electric vehicles to Rs 10,000/kWh and capped the maximum subsidy at 15% of the vehicle’s ex-factory price, leading to a significant decline in electric two-wheeler sales in June 2023.
Despite these challenges, Ola Electric remains optimistic about its future prospects and aims to surpass a $1 billion run-rate by the end of this year. The company has set ambitious targets for the fiscal year 2023-24, anticipating revenue to surge fourfold to $1.5 billion.
Additionally, Ola Electric is progressing with its initial public offering (IPO) plans and has initiated discussions with investment bankers. Goldman Sachs, Kotak, Citi, and Axis have joined the IPO, and the company plans to raise $1 billion in net proceeds at a valuation of $10 billion. Ola Electric is expected to file its draft red herring prospectus (DRHP) by the end of the next quarter and aims to launch the IPO by the final quarter of the current fiscal year.
The IPO proceeds will be utilized to expand operations, establish the company’s battery manufacturing plant, and boost scooter production. Major shareholders such as Temasek, Softbank, Tiger Global Management, Edelweiss, Matrix Partners India, Kia Motors, and Alpha Wave Investors may also consider offloading some of their stakes in the company during the IPO.
Ola Electric’s commitment to the EV sector and its focus on innovation continue to drive its growth and position the company as a key player in the rapidly evolving electric vehicle industry.
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