Ola Electric's board approved reallocating ₹575 crore from its IPO proceeds
R&D funding was reduced by ₹575 crore to strengthen the balance sheet
Debt repayment allocation increased significantly from ₹395 crore to ₹870 cr
Ola Electric has decided to revise the utilisation of its IPO proceeds, signalling a strategic shift in capital allocation.
In a communication to stock exchanges on Wednesday, the company said its Board approved a proposed variation in the use of IPO funds, subject to shareholder approval.
2 March 2026
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Reallocation Details
The revision includes reallocating around ₹575 crore from its research and product development (R&D) budget to other priorities.
According to the company, ₹100 crore of the reallocated funds will be directed toward organic growth initiatives, while ₹475 crore will be used for debt repayment or prepayment.
As a result, the total allocation for R&D will be reduced from ₹1,505 crore to ₹930 crore, while the allocation for debt repayment will increase significantly from ₹395 crore to ₹870 crore. As of March 11, 2026, the company had ₹1,295.63 crore in unutilised IPO proceeds.
This marks the second major revision in the use of IPO funds within a year. In August 2025, Ola Electric had already reduced its R&D allocation, introduced a debt repayment component, and increased spending toward organic growth. The latest move further underscores a shift in focus toward balance sheet strengthening and near-term financial priorities.
Ola Electric Financial Performance
The decision comes amid weak financial performance in the third quarter of FY26. Ola Electric reported consolidated revenue of ₹470 crore, reflecting a sharp decline of 31.9% from ₹690 crore in the previous quarter and a 55% drop from ₹1,045 crore in the same period last year.
The company posted a net loss of ₹487 crore, while its adjusted operating EBITDA loss widened 25% quarter-on-quarter to ₹323 crore. The EBITDA margin deteriorated significantly to negative 68.7%, compared with negative 37.4% in the previous quarter.
The company delivered 32,680 electric two-wheelers during the quarter. Despite the weak topline performance, some operational metrics showed improvement.
Consolidated gross margin rose to 34.3%, up from 30.9% in Q2 and 18.6% a year earlier, supported by its vertically integrated manufacturing model and improved unit economics from its Gen 3 platform. Total operating expenses increased marginally by 3.8% sequentially to ₹432 crore but declined 34% on a year-on-year basis.
