Ola Electric Mobility shares jump 20% to hit upper circuit limit after flat market debut

PTI, Aug 9, 2024, 3:05 PM IST

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New Delhi: Shares of Bhavish Aggarwal-led electric two-wheeler company Ola Electric Mobility Ltd surged 20 per cent to hit the upper circuit limit against the issue price of Rs 76 after listing on a flat note earlier in the day on Friday.

The stock made its debut at Rs 75.99, marginally down by 0.01 per cent from the issue price on the BSE. The stock made a smart comeback and jumped 19.97 per cent to Rs 91.18 — the upper circuit limit.

At the NSE, shares of the firm listed at par with the issue price of Rs 76. Later, the stock soared 20 per cent to Rs 91.20 — its upper circuit limit, in a remarkable comeback.

The company’s market valuation stood at Rs 40,217.95 crore.

The Rs 6,145-crore initial public offer of Ola Electric Mobility received 4.27 times subscription on the final day of bidding on Tuesday.

The initial share sale had a price band at Rs 72-76 a share.

The Initial Public Offering (IPO), the first by an electric vehicle maker, had a fresh issue of up to Rs 5,500 crore and an Offer-for-Sale (OFS) of up to 8,49,41,997 equity shares.

According to its prospectus, Ola Electric Mobility Ltd (OEML) 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.

In its Red Herring Prospectus (RHP), OEML said the 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).

The company said a portion of the proceeds will be used for capital expenditure to be incurred by OCT for expansion of the capacity of cell manufacturing plant from 5 GWh to 6.4 GWh.