Motilal Oswal Financial Services and its investment arm Calliope Capital Advisors have collectively applied for 2.39 crore shares in Ola Electric Mobility’s Rs 1,000 crore rights issue which opened this week and is priced at a significant discount.
- Motilal Oswal applied for 1.28 crore shares; Calliope Capital for 1.10 crore.
- Rights issue priced at Rs 27 per share with a 26% discount to market.
- Ola Electric plans to raise Rs 1,000 crore via partly paid-up shares.
What happened
Motilal Oswal Financial Services and Calliope Capital Advisors submitted applications for a combined total of 2.39 crore shares in Ola Electric Mobility’s Rs 1,000 crore rights issue on its opening day. The Motilal Oswal entities acquired these rights through renunciation by Ola Electric promoters ANI Technologies and Indus Trust, as per the company’s stock exchange filing. The pricing of the rights issue was set at Rs 27 per partly paid-up share, which represents a discount of approximately 26% to Ola Electric’s current market price.
The offer consists of 37.03 crore partly paid-up shares. Investors are required to pay Rs 16.20 upfront per share, with the remaining Rs 10.80 payable at a later stage, expected by October 31, 2027. The rights issue commenced on October 21 and will close on October 30, with rights entitlements transferable until October 26.
Why it matters
This capital raise is critical for Ola Electric as it seeks to strengthen its financial position amid fierce competition in the Indian electric two-wheeler market. Despite holding a top-five market position with a 6.5% share in September, the company’s revenues have declined year-over-year and vehicle registrations have softened, intensifying the need for fresh capital to support expansion and operational improvements.
The rights issue follows a recent Rs 780 crore qualified institutional placement in June, highlighting Ola Electric’s ongoing fundraising efforts to compete with established players such as TVS Motor, Bajaj Auto, Hero MotoCorp, and fellow electric vehicle maker Ather Energy. The discounted pricing and partly paid-up structure may help attract investor participation while providing the company flexibility in managing its capital inflows.
What to watch next
Market participants will closely observe the final subscription level of the rights issue by October 30 to gauge investor confidence in Ola Electric’s growth prospects and balance sheet stability. The progress of the subsequent payments on partly paid shares due by late 2027 will also be important metrics for the company’s financial health.
Additionally, tracking Ola Electric’s performance relative to competitors in the coming quarters, including sales volumes and market share changes, will show how well the company leverages this infusion of capital. The company’s ability to narrow losses and reverse its revenue decline will be key indicators of the effectiveness of its strategic moves amid evolving market conditions.