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Ola Electric founder Bhavish Aggarwal has taken a big decision regarding his stake. To repay the loan, he has sold shares worth Rs 92 crore in the open market. After this step, investors are keeping an eye on the company’s promoter stake and share performance.
New Delhi. Bhavish Aggarwal, founder and promoter of Ola Electric Mobility Limited, has taken a big step regarding the shares of the company. He has started the process of repaying the promoter level loan by selling shares worth Rs 92 crore in the open market. After this deal, the eyes of investors are focused on the company’s shareholding, promoter stake and recent performance of the stock.
Sale of 2.6 crore shares in open market
According to NSE bulk deal data, Bhavish Aggarwal sold 2.6 crore equity shares at a price of Rs 34.99 per share. Information about the buyers of this deal has not been revealed. As of September quarter, Bhavish Aggarwal held 30.02 percent stake in the company, out of which 10.11 percent shares were pledged with lenders and 66.63 percent shares were locked-in. Earlier also during the IPO in August, he had sold 3.8 crore shares at a price of Rs 76 per share.
‘One-time’ step to repay promoter loan
The company has described this deal as ‘one-time and limited monetization’ of the promoter’s personal stake. According to Ola Electric, the entire promoter level loan of Rs 260 crore will be repaid from this sale. Along with this, about 3.93 percent of the shares pledged earlier will also be completely released. The company said that after this transaction, the promoter group’s stake will remain at around 34 percent, which is among the highest levels among new-age listed companies.
Promoter control intact
Ola Electric has made it clear that there will be no reduction in promoter control through this deal. The company says that promoter pledges often bring unnecessary risks and fluctuations in the shares, hence it was necessary to eliminate them completely. This entire process has been done at the personal level of Bhavish Aggarwal and will not have any impact on the operations, governance or strategic direction of the company.
Stock performance and market opinion
The effect of this news is already visible in the stock market. Shares of Ola Electric closed the day at Rs 34.48, down 8.5 per cent, while the Nifty 50 fell only 0.6 per cent. This stock has fallen by about 60 percent since the beginning of the year and has recently touched an all-time low of Rs 33.2. Out of eight analysts, three have advised ‘Buy’, one has advised ‘Hold’ and four have advised ‘Sell’. The average target price is Rs 45.88, which shows potential upside from current levels.
