Ola Electric's Rs 6,145-cr IPO fully subscribed on Day 2

The Rs 6,145-crore initial public offer of electric two-wheeler company Ola Electric Mobility got fully subscribed on the second day of bidding on Monday, driven by demand from retail investors and non-institutional investors.

The initial share sale received bids for 49,43,63,610 shares against 46,51,59,451 shares on offer, translating into 1.06 times subscription, according to the NSE data.

The category for Retail Individual Investors (RIIs) fetched 2.87 times subscription while the quota for non-institutional investors got subscribed 1.11 times.

The portion for Qualified Institutional Buyers (QIBs) received 40 per cent subscription.

The Initial Public Offer (IPO) has 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.

The price band for the offer is Rs 72-76 a share.

The issue is open for subscription until August 6.

Under the OFS, Ola Electric founder Bhavish Aggarwal is offloading almost 3.8 crore shares.

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 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 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.

On Thursday, the company mobilised Rs 2,763 crore from anchor investors, including SBI Mutual Fund (MF), HDFC MF, Nippon India MF, Bharti Axa Life Insurance Company, Kotak Mahindra Life Insurance Company, Nomura India Investment Fund, Goldman Sachs (Singapore) Pte Ltd and Fidelity.

Kotak Mahindra Capital Company, Citigroup Global Markets India, BofA Securities India, Goldman Sachs (India) Securities, Axis Capital, ICICI Securities, SBI Capital Markets and BOB Capital Markets are the managers to the offer.