Ola Electric has announced a strategic shift in the use of its IPO proceeds, reallocating ₹575 crore from its research and development budget. This decision comes as the company faces challenges in the electric vehicle market.
The board has proposed that ₹100 crore will be directed towards organic growth initiatives, while ₹475 crore will be used for debt repayment. This adjustment will reduce the total budget for research and development from ₹1,505 crore to ₹930 crore, increasing the debt repayment allocation from ₹395 crore to ₹870 crore.
Shareholder approval is now required for these proposed changes. As of March 11, 2026, Ola Electric had ₹1,295.63 crore in unutilized IPO proceeds.
This marks the second significant alteration in the allocation of IPO funds within a year. In August 2025, the company had already adjusted its R&D spending and introduced a debt repayment component, while boosting its focus on organic growth.
The latest decision comes amid declining sales and ongoing financial losses, contributing to a more than 30% drop in Ola Electric's share price year-to-date, following a 55% decline in 2025.
Looking ahead, Ola Electric is intensifying its efforts in the cell manufacturing sector, particularly in battery energy storage systems (BESS). Recently, reports indicated that the company is seeking to raise up to ₹2,000 crore by selling a minority stake in its battery division, Ola Cell Technologies, to financial investors.
In addition to this, Ola Electric has plans to raise ₹1,500 crore through a Qualified Institutional Placement (QIP) and up to ₹1,700 crore via debt instruments, although these initiatives have not yet fully materialized.
Financially, Ola Electric reported a 55% year-on-year revenue decline to ₹470 crore in Q3 FY26, while its net loss narrowed by 14% year-on-year to ₹487 crore. The company also faced negative operating cash flows of ₹866 crore over nine months due to continued losses and disappointing sales figures.
As of the latest trading session, Ola Electric shares were down 5.51% at ₹23.50 on the BSE, reflecting broader market trends amid geopolitical tensions.
