Ola Electric seeks ₹1,200 crore in funding amid market challenges
What's the story
Ola Electric is in talks to raise ₹1,000-1,200 crore ($120-140 million) through private credit, as per a Moneycontrol report. The Bengaluru-based electric two-wheeler start-up intends to use most of the funds for refinancing an existing bank loan. The move comes as Ola Electric faces challenges in the market, including increased competition and financial losses.
Past initiatives
Focus on refinancing existing bank loan
Earlier this year, Ola Electric had received board approval to raise ₹1,700 crore by issuing non-convertible debentures (NCDs) and other eligible debt securities. However, this time around, the company's focus is on refinancing an existing bank loan with the fresh funds. The plan is expected to be finalized over the course of FY26.
Funding strategies
Losses have widened to ₹870 crore
Along with private credit, Ola Electric is also considering other fundraising methods such as qualified institutional placement. However, the company's founder and MD Bhavish Aggarwal has shown a preference for the private credit route. This comes as Ola Electric's market share has been challenged by legacy players and its losses have widened to ₹870 crore in Q4FY25 from the previous year. Ola Electric's share price, which was at ₹40 today, has declined 44% in the past six months.