India’s Ola Cabs plans $500 million IPO, to appoint banks soon, sources say

Mumbai – Ola Cabs, a prominent player in India’s ride-hailing industry and backed by SoftBank, is gearing up for an initial public offering (IPO) aimed at raising $500 million. With its sights set on a company valuation of approximately $5 billion, Ola intends to submit the necessary paperwork for regulatory approval within the next three months, according to sources familiar with the matter.

Ola declined to comment.

Ola Cabs is currently in discussions with prominent investment banks, including Goldman Sachs, Bank of America, Citi, Kotak, and Axis, with plans to appoint IPO advisers within the next month, according to sources familiar with the matter. While Citi and Bank of America refrained from commenting, responses from the others are pending. This marks Ola’s second endeavour at an IPO, following the abandonment of a 2021 plan aimed at raising up to $1 billion.

The move follows closely on the heels of Ola Electric, a sister company, filing its draft red herring prospectus with market regulator Sebi in December, signalling its intent to raise approximately Rs 7,250 crores through an IPO. Notably, Ola Electric has achieved a significant milestone by becoming the first Indian two-wheeler company to secure a domestic value addition (DVA) certificate under the production-linked incentive (PLI) scheme for the automobile and auto component industry. Ola Electric’s strategic initiatives, including product diversification and the introduction of an industry-leading 8-year/80,000 km extended battery warranty at no additional cost, underscore its commitment to innovation and customer satisfaction. In the broader landscape of electric vehicle (EV) firms, Ather Energy, a Bengaluru-based company specializing in electric scooters, is also making strides toward an IPO, aiming to raise an estimated $400 million. With Ola’s valuation undergoing adjustments by key investors, including Vanguard, Warburg Pincus, Temasek, and Tiger Global Management, the company’s journey toward public listing reflects the dynamic nature of the market. Ola, founded by entrepreneur Bhavish Aggarwal, continues to navigate challenges, including international business closures, while focusing on profitability and operational efficiency within its cab business segment.