Ola Cabs Aims $500 Million IPO at $5 Billion Valuation

Ola Cabs, the Indian ride-hailing giant backed by SoftBank, is gearing up for an initial public offering (IPO) to secure around $500 million. The company is targeting a valuation of approximately $5 billion and intends to file the necessary paperwork with the Securities and Exchange Board of India (SEBI) within the next three months.

Ola is currently in discussions with several financial institutions, including Goldman Sachs, Bank of America, Citi, Kotak, and Axis, to appoint IPO advisers. The company aims to finalize these appointments within the next month. This marks Ola's second attempt at going public, following a shelved plan in 2021 to raise up to $1 billion.

The move comes after Ola has taken steps to streamline its operations and cut losses. The company has shut down its international businesses in the UK, Australia, and New Zealand, focusing instead on its core Indian market. "Ola's India mobility business broke even in FY23, with a segment adjusted EBITDA of around INR 250 crore, compared to an EBITDA loss of INR 66 crore in the previous year," according to sources familiar with the matter.

Why this matters: Ola's IPO intentions are a significant development in India's rapidly evolving tech and startup ecosystem. As one of the country's most prominent ride-hailing companies, Ola's public listing could set a benchmark for other Indian startups considering the IPO route. The success of Ola's IPO could also have implications for investor sentiment towards the Indian market.

Ola's valuation has fluctuated in recent years, with one of its shareholders, Vanguard, revising its internal valuation of the company to $1.9 billion in February 2023. However, the company's decision to pursue an IPO at a $5 billion valuation suggests confidence in its growth prospects and market position.

Bhavish Aggarwal, Ola's founder, is a prominent figure in India's startup landscape. He also heads Ola Electric, the country's leading electric scooter manufacturer, which has already filed regulatory papers for its own IPO. Ola Electric holds about a 30% share in India's e-scooter market and plans to raise $700 million through its public listing.

As Ola prepares for its IPO, the company is focusing on expanding its electric fleet in India, with the aim of becoming the preferred mobility provider for all travel needs. The funds raised through the IPO will likely be used to further strengthen Ola's position in the Indian market and invest in

Key Takeaways

• Ola Cabs plans $500M IPO to raise $5B valuation, files with SEBI in 3 months.
• Ola in talks with banks like Goldman, BofA to appoint IPO advisers within a month.
• Ola's India mobility biz broke even in FY23, after shutting down intl operations.
• Ola's IPO could set benchmark for other Indian startups considering public listing.
• Ola Electric, India's leading e-scooter maker, also plans $700M IPO.