IPO-Bound Ola Electric Mulls Bidding For Lithium Mining Rights

Bhavish Aggarwal-led Ola Electric is reportedly considering bidding for mining rights for lithium blocks being auctioned by the Indian government.

“Ola has shown interest and has put forward lots of queries around land acquisition and discovery of other minerals alongside lithium in the blocks,” Reuters reported citing a source. 

While executives of the startup attended the auction meetings, it is yet to take a final call on the matter, the report said.

Lithium is a critical component in the production of lithium-ion batteries used in electric vehicles (EVs), smartphones, and other electronic devices. 

Getting the mining rights for lithium will help the startup, which plans to manufacture lithium-ion batteries for its two-wheeler EVs. 

It is working on the establishment of Ola gigafactory for the production of rechargeable batteries for its EVs. Spread across 115 acres of land, the Ola gigafactory will have a battery production capacity of 20GWh.

The government opened the auction of lithium, along with 20 other critical minerals, in November last year. About 5.9 Mn tonnes lithium reserves found in Jammu and Kashmir’s Reasi district are up for auctions.  

Other potential bidders for lithium reportedly include Adani Enterprises, Vedanta Ltd, Reliance Industries, and Himadri Chemicals. 

The collective value of the blocks, which include titanium, bauxite (aluminous laterite), glauconite, nickel, chromium, potash, copper, graphite, was estimated at INR 45,000 Cr at the time of the auction. 

In March last year, union road transport and highways minister Nitin Gadkari said that India can become the world’s number one EV manufacturer with the deployment of the lithium reserves. 

Earlier, Ola Electric’s founder Aggarwal had called for building an alternate supply chain for lithium to curb the country’s increasing dependence on China. 

The development comes at a time when the EV manufacturer is gearing up for its initial public offering (IPO). In December last year, Ola Electric filed its DRHP with market regulator SEBI to raise over INR 7,000 Cr via its IPO.

The EV maker has been one of the leading players in the two-wheeler EV market in the country for some months now. According to Vahan data, total two-wheeler EV registration increased 7.4% month-on-month (MoM) to 81,344 units in January 2024, with Ola Electric again topping the charts.  

Ola Electric’s escooter registrations increased 6% MoM to more than 32,000 units in January 2024. On a year-on-year basis, the EV maker witnessed an over 75% jump from the 18,353 units it sold precisely a year ago.

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