Ola Electric Secures Compliance Certification, Plans ₹877.64 Crore Fundraising
Ola Electric has secured a compliance certification for its Gen 3 scooter range under the government's Production Linked Incentive scheme. Meanwhile, the company's amd stock has been volatile, declining 42.83% over the past year. In a significant move, Ola Electric plans to raise ₹877.64 crore through preference shares, aiming to strengthen its financial position and reduce dependence on imported battery cells.
The fundraising, approved by Ola Electric Mobility's subsidiary, differs from the company's previous stock market allocation strategy. It involves issuing preference shares to another subsidiary focused on battery cell research and manufacturing. This preference share structure provides Ola Electric with greater financial flexibility compared to traditional debt instruments.
The company's stock price reacted positively to the fundraising announcement, closing 4.98% higher at ₹56.66 on the BSE. Over 18.36 million shares were traded by midday, hitting the 5% upper circuit limit. Despite the recent volatility, Ola Electric's stock price has shown resilience following the fundraising news.
Ola Electric's strategic move to secure compliance certification and raise funds through preference shares indicates its commitment to strengthening its financial position and accelerating its electric two-wheeler market growth. The company's market share in electric two-wheelers declined from 18.7% in August to 13.2% in September, highlighting the need for continued investment and innovation.
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