Ola Electric's Market Share Drops as Fundraising Boosts Stock
Ola Electric's market share in electric two-wheelers dipped from 18.7% in August to 13.2% in September. Meanwhile, the company raised funds through a preference share issue, boosting its stock market price.
Ola Electric Mobility, a subsidiary of Ola Electric Technologies, raised ₹877.64 crore through a preference share issue. The fundraising, facilitated by Kotak Mahindra Bank, was an intra-group transaction between Ola Electric Technologies and Ola Cell Technologies.
The preference shares, Series A Optionally Convertible Redeemable Preference Shares (OCRPS), were issued at ₹10 per share with a nominal 0.001% dividend rate. This structure provides Ola Electric with greater financial flexibility compared to traditional debt instruments. It also marks a shift from the company's original IPO allocation strategy.
The fundraising had a positive impact on Ola Electric's stock market price. It closed 4.98% higher at ₹56.66 on the BSE on Monday. However, the stock has been volatile, declining 42.83% over the past year and 24% from its September high.
Ola Electric's market share decline in electric two-wheelers comes as the company secures compliance certification for its Gen 3 scooter range under the government's Production Linked Incentive scheme. The recent fundraising, though boosting the stock market price, follows a trend of volatility in the company's shares.
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