Ola Electric has begun a formal effort to get up to Rs 2,000 crore through a sale of a piece of Ola Cell Technologies (OCT). The money will give a value to the gigafactory and make the company’s finances better as it tries to turn things around. Avendus and Motilal Oswal investment banks are in charge of the deal.
How the money will be raised and what the company wants to do
The Rs 2,000 crore that’s planned will be from giving up a share of OCT – not the main Ola Electric company. Ola Electric thinks this is a way to get partners in the battery business, who could be either experts in the field or give money, and also to get the group’s money in better shape. The process should also give a price to the battery part of the business. People who know about it say that investors, including big funds from governments, are interested because of how big the asset is and the technology it uses. Getting money from outside could speed up making more capacity, and lower the risk to the main company – and show that people have trust in making batteries in India.
How big the OCT gigafactory is, and how it will grow
OCT owns a lithium-ion cell factory in Tamil Nadu, which now makes 1.5 GWh of batteries. The company wants to get this up to 6 GWh by the end of the current financial year – four times as much, which would really increase how many cells are made in the country. The gigafactory originally cost about Rs 3,500 crore to set up.
Making cells in the country is a key goal, as the country wants to depend less on cells from other places and build a supply chain for electric vehicles in India. The factory also aims at wider markets, supplying energy storage systems and for use in industry, and not only for two-wheeled vehicles.
What the Battery Innovation Centre does and how it improves technology
OCT’s Battery Innovation Centre has more than 200 people who used to work for world companies, and has almost 400 patents. Its work covers several kinds of cell chemistry – NMC, LFP, LMFP and LMR – and looks at shapes like cylindrical, prismatic and solid-state cells.
A big step forward is a way of making electrodes without liquid, which the company says is a major improvement in making lithium-ion batteries. Using this, OCT made the 4680-format Bharat Cell, which is now made at the gigafactory and has been in Ola Electric vehicles for more than half a year.
How it helps store energy and use renewable sources
As the mix of power sources moves to renewables, storing energy becomes important to match how much is made with how much is used. India wants about 50 percent of its power to be from renewables by 2030, which will need a lot of storage so that a large amount of renewable electricity can go through batteries before reaching people.
Ola has launched home battery energy storage systems (BESS) and plans to get into business energy storage. These products are for problems where electricity made goes straight to use, and doesn’t make the best use of things like solar, wind, water and heat sources.
What investors are interested in, and how much the business is worth
Selling a piece of the business will help give a standard value to a rare battery cell asset in the country. Giving jobs to Avendus and Motilal Oswal means a planned, bank-led process which may get both partners with expertise and financial investors. Who the investor is will affect how the business is run, how easy it is to get money in the future, and what plans there are for technology.
Getting the money could make Ola Electric’s finances stronger, letting it spend more money and launch products for sale. However, the value and what the deal is about will show what the market thinks about the company’s technology, how well it can do things, and how much demand there is for energy storage in India and countries it sells to.
Ola Cell Technologies is now at the point where technology, making things, and energy policy come together. What happens with this raising of money will not only affect one company, but also how well India can make its own batteries.
