Ola Electric’s Bhavish Aggarwal Calls MapmyIndia “Opportunistic” For Sending Legal Notice

Ola Electric CEO Bhavish Aggarwal has called geotech company MapmyIndia’s move to send a legal notice to the IPO-bound electric vehicle (EV) manufacturer opportunistic.

Addressing media questions at a pre-IPO press conference, Aggarwal said, “We think it is very opportunistic of them given that Ola Electric is not even in the map business. We as a group have three different entities, Ola Cabs, Ola Electric, and Krutim. There are opportunistic players across the board and we will definitely respond to them at the right time.” 

On July 29, MapmyIndia’s parent entity CE Info Systems accused Ola Electric of illicitly copying its data to build its recently launched Ola Maps interface. The company sent a legal notice to Ola Electric for co-mingling and reverse engineering its licensed product.

Ola Electric then called the allegations “false, malicious and misleading”. “We would like to state unequivocally that these allegations are false, malicious and misleading. Ola Electric stands by the integrity of its business practices. We will suitably respond to the notice shortly,” a company spokesperson said. 

It is pertinent to note that the two warring companies inked an agreement in June 2021, which gave Ola Electric the licence to use MapmyIndia’s data . 

Ola Electric’s Attractive IPO Pricing

Meanwhile, Ola Electric is set to make its public market debut. The company’s IPO will open on August 2 and close on August 6. The EV maker has set a price band of INR 72-76 per equity share for the public offer via which it is aiming to raise over INR 6,145.6 Cr at the upper end of the price band.

On the pricing of the public offer, Aggarwal said that the company has a very big opportunity to grow and it wanted to keep the pricing attractive. 

“Ola Electric is essentially an India story and we wanted the Indian investor community to be part of the story. We want their partnership, we want their support, and we also want them to also create wealth for themselves… We wanted to price it so that the investor community feels excited about it,” he said. 

However, the company is looking for a listing at a time when its losses are widening. For the financial year 2023-24 (FY24), Ola Electric’s net loss widened 7.6% to INR 1,584.4 Cr from INR 1,472.1 Cr in the previous year.

While its topline surged over 90% to INR 5,009.8 Cr in the fiscal, its total expenses also shot up over 60% to INR 6,277.4 Cr from INR 3,883.4 Cr in the previous year.

A majority of its burn is attributed to the jump of over 75% in the cost of materials consumed, which stood at INR 4,390.9 Cr during the year under review from INR 2,504.8 Cr in FY23.

Ola Electric’s Dependency On China

As per the RHP, Ola Electric’s imported supplies accounted for 37.03% (a majority of it from China) of the cost of materials consumed in FY24 as against 31.11% in FY23. Meanwhile, domestic supplies comprised 62.97% of the cost of materials consumed in FY24 as compared to 68.89% the previous year.

Addressing a question on the dependence on China, Aggarwal said he anticipates the dependence on China to reduce in the long term. Breaking the process of building electric batteries into three parts, he said that the majority of the company’s dependence on China is for processing raw materials to build cell components (midstream process). 

He said that the company is currently looking to bring the process of assembly of the battery cells, the “Level I” of battery manufacturing, in India via its Gigafactory. Post that, he said that the company plans to bring the midstream process to the home soil as well. 

Aggarwal also lauded the government’s decision to quash custom duties on the import of key minerals required for EV battery manufacturing. He said that the move will benefit the company’s push to Indianise battery production.