In anticipation of its impending IPO, Ola Electric Mobility Ltd has unveiled a strategic blueprint that earmarks a substantial portion of its INR 5,500-crore public issue for transformative initiatives. A notable allocation of INR 1,226.43 crore is designated for the augmentation of its cell manufacturing plant, propelling the capacity from 5 GWh to an impressive 6.4 GWh, as articulated in the documents submitted to the Securities and Exchange Board of India (Sebi). In tandem, a strategic allocation of INR 1,600 crore is set aside for research and product development, with an additional INR 800 crore earmarked for debt repayment.
Strategic Cell Manufacturing Expansion
The comprehensive details presented in the draft red herring prospectus (DRHP) delineate Ola Electric’s phased approach to the Ola Gigafactory situated in Krishnagiri, Tamil Nadu. The financing for the Phase 1 (a) and Phase 1 (b) expansion will be sourced from internal accruals and long-term borrowings facilitated by Ola Cell Technologies Pvt Ltd (OCT). The gigafactory’s journey commences with Phase 1 (a), projected for completion by March 2024 with a capacity of 1.4 GWh. Subsequently, Phase 1 (b) aims to elevate the capacity to 5 GWh by October 2024, both milestones to be funded by internal accruals and long-term borrowings availed by OCT.
Timely Milestones:
- Phase 1 (a): Completion by March 2024 (1.4 GWh capacity).
- Phase 1 (b): Capacity increased to 5 GWh by October 2024.
Future Expansion Plans
A visionary Phase 2 is mapped out, envisaging a capacity surge to 6.4 GWh by April 2025, with an ambitious target to reach 20 GWh by the second quarter of the calendar year 2026. This strategic expansion is facilitated by the company’s judicious utilization of IPO funds, specifically focusing on elevating the cell manufacturing plant capacity from 5 GWh to 6.4 GWh.
Product Launch Strategies
Beyond the infrastructure development narrative, Ola Electric is charting a bold trajectory in the realm of electric mobility. The company foresees the introduction of affordable Ola S1 models, including electric two-wheelers (E2Ws), in the first half of Fiscal 2025. Furthermore, motorcycle enthusiasts can anticipate the commencement of deliveries, encompassing the Cruiser, Adventure, Roadster, and flagship Diamondhead models, by the first half of fiscal 2026. A comprehensive vision extends towards diversifying the product portfolio to include mass-market motorcycles, addressing varying consumer preferences and price points in the long run.
