Investors rush to find anchor in Ola Electric IPO; local, foreign cos sign up for likely $350m book
Ola Electric Mobility as the valuation of the electric two-wheeler maker's initial public offering (IPO) approaches $4 billion, down from earlier expectations. The IPO is set to open August 2.
Domestic investors, including SBI AMC, HDFC AMC, Nippon Life India AMC and UTI AMC will bid about $200 million each, while international ones such as Fidelity, Nomura and Norway's Norges Bank will bid in the range of $75-100 million each.
First Auto Fundraise in over 20 Years
People familiar with the development said so.
The maximum that an investor would be allowed is around $30 million, according to sources. The Ola Electric IPO will be the first automaker fundraise in more than two decades. Maruti Suzuki, India's largest car maker, was the last automaker to debut on the stock exchanges in 2003 as part of the government's divestment program.
Ola and the company's bankers didn't respond to queries.
The total anchor book size is expected to be $350 million (Rs 3,300crore), representing 45% of the total IPO size of Rs 6,200 crore. Of this amount, Rs 5,500 crore is from a fresh issue of shares, while the rest consists of an offer for sale (OFS) of 85 million shares by existing investors. Ola CEO Bhavish Aggarwal is participating in the OFS and has put 37.91 million shares on the block. As a result, his holding will decrease to 37% after the IPO, down from 45%. The anchor book is expected to open August 1, with the issue likely to run August 2-6, and listing anticipated on August 9.
HIGHER MARGIN OF SAFETY
Several factors
