Ola Electric clears Rs 1,500 Cr fund raise; COO quits

Ola Electric Mobility has approved a plan to raise up to Rs 1,500 crore through equity shares and convertible securities, pending shareholder and regulatory consent. This financial boost aims to bolster the electric two-wheeler manufacturer's financial flexibility as it competes in the market and enhances its operational performance.

COO Hyun Shik Park announced his resignation effective September 5, citing personal reasons. In response, Shradha Sharma of YourStory and Manoj Kumar Kohli, previously SoftBank India's Country Head, were appointed for another five-year term as independent directors, awaiting shareholder approval.

Ola Electric's latest announcement follows a Rs 780 crore Qualified Institutional Placement (QIP) conducted a few months prior, intended to bolster liquidity, support capital expenditure, repay debt, and manage working capital needs. The company has also raised its authorized share capital to Rs 8,722 crore from Rs 8,318 crore, providing more room for the proposed fund raise and requiring shareholder approval.

Ola Electric's financial situation remains challenging. In the June quarter, its revenue fell 45% year-on-year to Rs 455 crore, while the consolidated net loss widened to Rs 336 crore. However, deliveries improved to 39,192 units, nearly double the previous quarter, and the company achieved a 30.5% gross margin. Despite these gains, the company remains unprofitable at the operating level.

The competitive landscape has shifted significantly. TVS Motor reported a 137% increase in electric two-wheeler sales to 59,453 units in August, with its iQube reaching one million cumulative customers. Bajaj Auto expanded its Chetak range, including the affordable C25 model, which sold 3,02,674 units in FY26, up 16% year-on-year.

The Indian government has extended incentives for electric two-wheelers under PM E-DRIVE until March 2028, providing a Rs 2,500 incentive per kWh, capped at Rs 5,000 per vehicle. The central government has allocated Rs 2,767 crore for the e-2W component.