Indian ride-hailing firm Ola Electric is in talks to close a fresh funding round in the range of $250 million to $300 million, led by Goldman Sachs, a source familiar with the matter told DealStreetAsia.
The source said Ola may make an announcement about the fundraising in about a month. Ola declined to comment.
The Economic Times first reported about the fundraising discussions.
At a time when Ola has been facing intense competition from Uber, Rapido, and other local players in the Indian market, it is slowly pivoting its focus to new initiatives such as electric vehicles and food delivery, which has put pressure on its financials.
The company has been working on setting up its own lithium-ion cell factory in Tamil Nadu and expanding its product portfolio across segments of two-wheelers and four-wheelers.
Despite the economic volatility and the much-talked-about funding winter, the EV industry is growing at breakneck speed in India. According to data from DealStreetAsia, EV companies raised about $902 million across 60 deals in 2022, versus a total of $564 million across 35 transactions. This includes both EV and battery startups.
India targets to electrify 30% of private cars, 70% of commercial vehicles and 80% of two- and three-wheelers by 2030. In absolute numbers, this translates to 80 million EVs on Indian roads.
Ola aims to launch an IPO in the second half of this year, Bhavish Aggarwal said in December, with the company maintaining that it expects to achieve profitability “soon”.
While the firm has declined to give details on its latest expenses. In the year ended FY 21, the company’s total expenses went down from Rs 5,058 crore to Rs 2,007 crore. In February last year, Ola raised $20 million in its ongoing Series J round from Axis Growth Avenues AIF, and Arrow Multi-Asset Fund, reportedly at a valuation of $7.15-7.3 billion.
Earlier this year, the company reportedly shut down its recently acquired Avail Finance app and integrated it with OlaMoney. Ola bought Avail Finance, founded by Ola’s founder Aggarwal’s brother Ankush Aggarwal, last year. Last year, it shut down Ola Dash — its quick commerce business — and used-cars retail Ola Cars.
It raised over $200 million from Tekne Private Ventures, Alpine Opportunity Fund, Edelweiss and others in January 2022 at a valuation of $5 billion.
The fundraising discussions come two months after the company laid off 200 employees across the verticals of Ola Cabs, Ola Electric, and Ola Financial Services.