Ola Electric board approves Rs 1,000 crore rights issue

Reports coming in for today mention that Ola Electric on Monday stated its board has approved a rights offering of partly paid-up equity shares worth up to Rs 1,000 crore, subject to regulatory and statutory approvals.

The firm stated the offering will be open to eligible shareholders as of a record date, which will be decided and notified subsequently. The rights offering price, entitlement ratio, offering period, payment terms and other details will additionally be determined by the board and disclosed later.

As per the Draft Letter of Offer available on the firm’s website, Bhavish Aggarwal, Chairman and Managing Director of Ola Electric, has confirmed that he will subscribe to his rights entitlement. Any renunciation of his entitlement will be limited to the promoter group or specified market participants.

The promoter group collectively holds around 32.97 per cent in the firm. Aggarwal may fund his participation by pledging part of his holding, sources tracking the development stated, describing the move as a sign of "firm founder commitment" to the firm.

The firm stated the rights offering will be conducted in accordance with applicable provisions under the Securities and Exchange Board of India (Offering of Capital and Disclosure Requirements) Regulations, 2018, the Firms Act, 2013 and other applicable laws.

Ola Electric had boosted Rs 780 crore through a qualified institutional placement in June 2026. The firm stated last week that it chose the rights offering route to allow existing shareholders, including retail market participants, to participate.

According to the Draft Letter of Offer, around Rs 350 crore of the proceeds will be used for debt repayment, while Rs 400 crore will be allocated towards organic expansion. The remaining amount will be used for general corporate purposes.

The debt reduction is anticipated to ease pressure on operating expenses and put the firm on the path to cash breakeven, taking away any dependence on external capital, a banking source had earlier confirmed.