Bhavish Aggarwal, founder and chief executive officer of Ola Electric Mobility Ltd., paid about 200 million rupees ($2.3 million) in cash to top up collateral for borrowings against shares, according to people with knowledge of the matter, as the stock slid on poor sales.
Aggarwal had raised 2.5 billion rupees for his generative AI venture Krutrim Data Center Pvt. by pledging Ola Electric equity and he voluntarily put in the extra money since March as the shares dipped below 50 rupees each, the people said, asking not to be identified as the details are private. No margin calls were triggered and the value of the stock collateral is more than twice the borrowed amount, they added.
Ola shares face selling pressure
Investors are closely watching SoftBank Group Corp.-backed Ola Electric, whose shares have fallen about 35% since it listed at 76 rupees in August. Hyundai Motor Co. and Kia Corp. cut their stakes in the company in recent days after the Indian e-scooter firm said quarterly losses have more than doubled amid regulatory and governance concerns.
Aggarwal has pledged or encumbered about 8% of his 30% Ola Electric stake, according to exchange data. Avendus Group, InCred Alternative Investments Pvt. and Modulus Alternatives Investment Managers had lent him the money in exchange for bonds issued by Krutrim, carrying coupon rates of around 14.9%-15.9% and backed by Ola Electric shares, according to data published by Bloomberg and one of the people.
Avendus and InCred declined to comment. Modulus didn’t immediately respond to Bloomberg’s email seeking comment. A representative for Ola Electric said all founder pledges have been disclosed and there are no more material developments; it declined to comment on what it said were “speculative” reports.
As the value of the Ola Electric shares dipped, Aggarwal pre-funded 3-4 months of accrued interest instead of topping up the collateral with more shares, one of the people said. Aggarwal earned some 2.8 billion rupees having sold a portion of his Ola Electric stake in the IPO.
Even though Ola Electric was trading at almost 50 rupees on Thursday, the top up cash won’t be returned to Aggarwal given the ongoing concerns about the listed company, one of the people said. The scooter-maker’s market share has shrunk to 18% in May from over 48% last year.
