Update | 17:40, March 18, 2020
The latest ministry of corporate affairs (MCA) filings of Ola Electric has confirmed that the company has raised INR 7.17 Cr from Pawan Munjal in its Series B round.
India’s first electric vehicle unicorn, Ola Electric, is reportedly in talks with Hero Motocorp Chairman Pawan Munjal for a potential round of funding, according to a media report which cited four sources close to the development.
“This deal has been in the works over the last few months and people close to Munjal were aware of the ongoing negotiations. He intends to invest in different startups going forward and this is also one among them,” the report added. This investment by Munjal is said to be done in his personal capacity.
It is interesting to note that Hero Electric is also a manufacturer of electric vehicles in India and might have plans to source its EVs to the Ola’s ride-hailing fleet. Another, EV manufacturer and an existing investor in Ola, Mahindra has also entered a similar partnership with an EV only ride-hailing company, BLU Smart.
The report also noted a source saying, “In the long term, this makes sense since Hero can supply its electric two-wheelers in the coming years to Ola. Also, at a time when the Union government is trying to promote electric mobility, such investment from a promoter of a two-wheeler manufacturer makes sense.”
Ola’s Electric Mobility Plans
Ola Electric was set up as an independent entity in March 2019. It is currently running several pilots involving charging solutions, battery swapping stations, and deploying vehicles across two, three and four-wheeler segments.
Earlier in July, Ola Electric has raised a massive $250 Mn Series B funding round from Japanese conglomerate SoftBank. Prior to this, the company has raised $56 Mn (INR 400 Cr) from investors such as Ratan Tata, Tiger Global, and Matrix Partners.
The company was initially established to enable Ola’s electric mobility pilot program in Nagpur, which was shelved soon after due to a number of issues. In 2018, Ola subsequently announced ‘Mission: Electric’. With Mission:Electric, Ola aimed to place 10K e-rickshaws and electric auto-rickshaws in its service in the next 12 months.
Ola has earlier also entered into a strategic partnership with South Korean automaker Hyundai along with its affiliate Kia Motors to fund a strategic partnership under which the three companies have planned extensively collaborate on building India-specific electric vehicles and infrastructure. Under this partnership, the company had earlier committed to putting 1 Mn electric vehicles on road by 2021.
Electric vehicles have been at the forefront of the NDA government’s development plans. From reducing GST rate of EVs to allocating an INR 10,000 Cr outlay for its EV focussed scheme FAME II — the government has been trying every trick in its hat to promote EV adoption in India.
The Indian electric vehicle industry recorded sales of 7.59 Lakh units in India till March 2019, this included the sale of 1.2 Lakh two-wheelers, 6.3 Lakh three-wheelers and 3.6K passenger vehicles. However, there has been a drop in electric two-wheeler sales after the announcement of FAME II.