Don’t Get Scammed By Ola IPO
Overview About the OLA Electric
Points to Keep in Mind Before Apply For the OLA Electric IPO
Strengths & Risks
The company’s direct-to-customer (D2C) omnichannel distribution network includes 870 experience centres and 431 service centres as of March 31, 2024. Ola Electric uses its website for direct sales.
Ola Electric’s R&D has created its proprietary operating system, MoveS. This system features navigation powered by Ola Maps, a centralised electronics architecture for vehicle control and interface, and a compact, adaptable motor and drivetrain suitable for varying power outputs.
The company is eligible to receive incentives under the Cell PLI Scheme over a five-year period following the commissioning of the Ola Gigafactory, provided it meets certain requirements.
The Ola Futurefactory has rapidly scaled up its operations within just eight months to achieve an installed capacity of one million units annually by March 31, 2024. The integration of manufacturing, in-house design, and R&D capabilities allows Ola to maintain its performance on its EV scooters, reduce costs, and bring products to market.
Ola Electric Mobility has seen a consistent increase in revenue from operations, growing from Rs 373.42 crore in FY22 to Rs 2,630.93 crore in FY23 and further to Rs 5,009.83 crore in FY24.
Ola Electric Mobility offers its customers charging solutions through its extensive network, which includes 248 hyper charger guns and 764 standard charger guns as of March 31, 2024, spread across 17 and 21 states, respectively. The company supports home charging with portable chargers.
Negative Aspects of The OLA Electric IPO
Ola Electric Mobility has a relatively short operating history and has registered losses and negative cash flows. Specifically, the company’s loss before tax amounted to Rs 784.15 crore in FY22, Rs 1,472.08 crore in FY23, and Rs 1,584.40 crore in FY24.
The expansion of the Ola Futurefactory could encounter delays, disruptions, or cost overruns. There is also a risk that these expansions may not deliver the potential benefits, which may affect the company’s production capacity, financial health, and operational results.
Ola Electric Mobility’s revenue is currently generated solely from a limited range of electric scooter models. If these models do not gain sufficient market acceptance, the company’s business prospects could be negatively impacted.
Any reduction or elimination of government incentives would increase the retail price of the company’s EVs, which could adversely affect customer demand for its products and consequently its profits.
Any reduction or elimination of government incentives would increase the retail price of the company’s EVs, which could adversely affect customer demand for its products and consequently its profits.
Ola Electric Technologies Private Limited, the company’s material subsidiary, has obtained working capital demand loans from banks and financial institutions totaling Rs 746 crore as of June 30, 2023. These loans are subject to recall on demand, which could pose financial risks.
The company has a total indebtedness of Rs 2,675.18 crore as on June 15, 2024. Any inability to service or repay these loans can hurt the company’s operations.
