Written by Aditya Kalra
NEW DELHI (Reuters) – The initial public offering of Indian e-scooter maker Ola Electric, backed by SoftBank, will attract bids from investors including Fidelity, Nomura and Norway’s Norges Bank as well as several Indian investment funds, two sources familiar with the matter told Reuters.
Ola Electric, which will launch an IPO worth around $740 million this week, will be India’s first electric vehicle maker. The company is the biggest player in the electric scooter market in a country where adoption of clean vehicles is still low but rising fast.
Fidelity will bid about $75 million while Nomura and Norges will bid $100 million each in what is called a book-entry IPO, where shares are allocated to prominent institutional investors before opening up to other investors, said the first source with direct knowledge of the bidding amounts.
At least four Indian investment funds, including SBI, HDFC, UTI and Nippon India, will submit bids, the sources said, with the first source estimating their combined bids at more than $700 million.
Ola Electric did not respond to a request for comment. None of the investors mentioned above immediately responded Sunday outside normal business hours.
Ola’s IPO, one of India’s largest this year, is set to see the company issue new shares to raise $660 million and will see existing investors, including founder Bhavish Aggarwal, divest their stake of around $80 million to IPO investors.
The first source said the main investors’ share in the IPO is about $330 million.
Sources had previously said the company was expected to be valued at $4.2 billion to $4.4 billion after the initial public offering, but the sources said on Sunday that the final value was lower at around $4 billion to $4.2 billion.
That valuation is about 22% to 26% lower than Ola’s last funding round in September, which was led by Singaporean investment firm Temasek and valued the country’s largest e-scooter maker at $5.4 billion.
The lower valuation of the IPO is due to a correction in the valuation of global technology companies worldwide, and Ola wants to ensure high participation in the offering, a source said.
The IPO comes amid heightened activity in India’s capital markets, with stock markets trading near a record high.