Ola Electric, the largest electric two-wheeler maker in India, jumped as much as 20% on its public debut Friday in what is the biggest listing among Indian firms in two years.
Shares of the Bengaluru-based firm, which counts SoftBank and Temasek among its backers, jumped to 91.18 rupees ($1.1) from than the upper IPO price band of 76 Indian rupees. The company filed for an IPO at a 26% lower valuation than the $5.4 billion it achieved in a funding round in October 2023, and significantly below the $6.5 billion to $8 billion range initially targeted for the IPO.
At 87 rupees, Ola Electric commands nearly $4.6 billion in market cap.
Ola Electric has emerged as the dominant player in India’s electric two-wheeler market, commanding a 46% market share in the year-to-date fiscal year 2025, despite a recent dip to 39% in July. Ola launched its first electric scooter in December 2021 and sold more than 330,000 units in the financial year ending March.
But the company is not profitable. It generated revenues of 50 billion rupees ($626.3 million) and reported an EBITDA loss of 13 billion rupees ($162.8 million) and a net loss of 16 billion rupees ($200.5 million) during the same period.
Ola Electric’s strategic initiatives include the development of its own battery cell technology and manufacturing capabilities, with plans to expand capacity to 20GWh by the second quarter of 2026. This vertical integration is expected to provide greater control over quality, supply, and costs.
The electric vehicle market in India is poised for substantial growth, with Macquarie projecting a gradual increase in the share of electric two-wheelers. Estimates suggest market penetration rates of 7%, 10%, 13%, and 16% for fiscal years 2025, 2026, 2027, and 2028 respectively. This contrasts with more optimistic forecasts of 41-56% by fiscal year 2028 in Ola Electric’s own prospectus, highlighting the ongoing debate about the pace of EV adoption in India.
Recent reductions in government subsidies for electric two-wheelers have impacted the sector’s growth trajectory. Despite this, the Indian electric vehicle market has witnessed a consolidation trend, with the Herfindahl-Hirschman Index (HHI), a measure of market concentration, rising from 1,200-1,330 in fiscal years 2022-2023 to 2,810 in the June quarter, surpassing the 2,160 figure for traditional internal combustion engine two-wheelers.
