US-based investment management firm Vanguard Group has marked down the valuation of ANI Technologies, the parent company of ride-hailing firm Ola, by about 35 per cent to $4.8 billion from $7.4 billion, according to a regulatory filing. Vanguard has a stake of approximately 0.7 per cent in Ola. The value of Ola‘s shares held by Vanguard funds fell to around $203.78 as of February 28, 2023, from $311.85 in August 31, 2022, according to filings with the US’ Securities and Exchange Commission (SEC).
This marks a significant decline in the ride-hailing company’s valuation, which had raised $500 million at a valuation of $6.5 billion in October 2021. ANI Technologies had filed its draft red herring prospectus with the Securities and Exchange Board of India (SEBI) for an initial public offering (IPO) in August 2021. However, it later decided to defer the IPO until market conditions improved.
The recent valuation markdown by Vanguard comes amid concerns about Ola’s prospects as the COVID-19 pandemic continues to impact the global economy. The pandemic has had a significant impact on the ride-hailing industry, which has seen a decline in demand as people stay at home and avoid travel.
In December 2021, Ola raised about $139 million from investors, including IIFL, Edelweiss, and Sunil Munjal-led Hero Enterprise. The funds were raised to support Ola’s expansion plans and enhance its technology capabilities. According to regulatory documents sourced from business intelligence platform Tofler, the ride-hailing firm issued 4,210 equity shares and 99,862 convertible preference shares to these investors.
Ola is one of the leading ride-hailing firms in India, along with Uber and others. It was founded in 2010 by Bhavish Aggarwal and Ankit Bhati and offers a range of services, including bike and car rentals, taxi services, and food delivery. The company operates in over 250 cities across India and claims to have over 200 million users.
Despite the challenges posed by the pandemic, Ola has continued to expand its services and operations in recent years. In November 2021, the company announced plans to invest $500 million in setting up a new electric vehicle (EV) factory in Tamil Nadu, India. The facility, which will be built in partnership with South Korean firm Hyundai Motor, is expected to have a production capacity of 2 million EVs per year.
Ola is also reportedly in talks with Indian banks to raise $500 million in debt financing to support its EV manufacturing plans. The company is said to be in discussions with several leading Indian banks, including State Bank of India and ICICI Bank, for the financing.
The ride-hailing firm has also been expanding its operations in international markets, including Australia, New Zealand, and the UK. In February 2022, the company announced the launch of its services in Tokyo, Japan, in partnership with Japanese taxi operator Nihon Kotsu. The company said it plans to offer a range of ride-hailing services in Tokyo, including taxis, cars, and bikes.
Despite the challenges faced by the ride-hailing industry, Ola has been optimistic about its future growth prospects. The company has been expanding its services in areas such as food delivery and financial services, which are expected to drive future growth. The plant is expected to have an annual capacity of 10 million vehicles and will help Ola to expand its presence in the EV market.
Despite the challenges faced by the ride-hailing industry due to the pandemic, Ola remains optimistic about its future prospects. The company is reportedly planning to go public in the near future, and has already filed its draft red herring prospectus with the SEBI. The IPO is expected to raise about $1 billion, which will be used to fund the company’s growth plans and expansion into new markets.
