Ola Electric gets $200 million funding at $3 billion valuation

INTERNATIONAL DESK: Ola Electric has raised more than $200 million from Falcon Edge, SoftBank Group and others at a valuation of $3 valuation, the electric vehicle (EV) arm of the ride-hailing startup said.

The funding will strengthen Ola’s “Mission Electric”, which urges industry players and consumers to commit to electric so that no petrol two-wheelers are sold in India after 2025, according to a statement issued on Thursday. It will also accelerate development of other vehicle platforms, including electric motorcycles, mass-market scooters and an electric car.

“I thank our existing investors and welcome new ones to Ola. Together we will bring mobility to a billion and sustainability to the future,” Ola CEO Bhavish Aggarwal said.

This is Ola Electric’s fifth fundraising— excluding the $10 million it received from Bank of Baroda last year—since inception, according to Tracxn data. The company counts Hyundai Motor Co. Ltd., Tiger Global, Matrix Partners India and Ratan Tata as among its investors.

Set up in 2017 to run e-taxis, Ola Electric diversified into manufacturing EVs after the Covid-19 pandemic crippled the company’s ride-hailing business. In February, the company launched the Ola Futurefactory—touted as the world’s biggest electric two-wheeler plant—near Krishnagiri in Tamil Nadu. Ola is also getting into the used car business, even as its taxi vertical is showing signs of a revival.

The announcement of the fundraising comes two weeks after Ola sold electric scooters worth Rs 1,100 crore during the two days that the purchase window was open.

Ola restarted on September 15 sales and bookings of its electric scooters—S1 and S1 Pro—on the Ola app only, after the website built for purchases ran into technical difficulties in the previous week. Sales reached a peak of four units per second on Thursday, Aggarwal had tweeted then.

“In total over two days, we have done over Rs 1,100 crore in sales! This is unprecedented not just in the automotive industry but it is one of the highest sales in a day (by value) for a single product in Indian e-commerce history,” he had said in a blog post. “We truly are living in a digital India.”

The purchase window is now closed, but the scooters can still be reserved on Ola Electric’s website. The sale will restart on November 1.

Launched at a starting price of Rs 99,999, includes FAME II subsidies but excluding state-level tax breaks, the Ola electric scooters come in two variants:

1. The cheaper Ola S1, which gets a 2.98 kWh battery pack good enough for travelling 121 km on a single charge. The top speed is restricted at 90 kmph.

2. The costlier Ola S1 Pro, which gets a 3.97 kWh battery pack with a range of 181 km. It has a top speed of 115 kmph.

Ola will also roll out an at-home service network in every city where it sells its EVs and said that buyers can expect a 40% lower total cost of ownership for its EVs as compared to petrol-powered scooters in the market today.

The scooters also include features such as keyless lock/unlock, different modes and profiles for different riders, and will even allow riders to set moods that will change the sound and display graphics. Both models will also get a reverse mode and hill-hold assist. (The Economic Times)