Investor trims Ola's valuation to about $3 billion, says report

 This development comes at a time when Ola has revealed new growth plans, including setting up a Rs 2,400-crore electric vehicle facility expected to become the world's largest two-wheeler factory

An investor in ride-hailing giant Ola has marked down its valuation further after slashing it by nearly half at the onset of the Covid-19 pandemic that disrupted business a year ago, according to a report by The Capital Quest.

This development comes at a time when Ola has revealed new growth plans, including setting up a Rs 2,400-crore electric vehicle facility expected to become the world’s largest two-wheeler factory. Ola’s ride-hailing business is recovering after the coronavirus pandemic’s hurt and demand for its food business and financial services improves.
The Capital Quest report said Ola, operated by ANI Technologies Pvt. Ltd, was one of the worst-hit technology startups in India as many companies switched to a work-from-home routine and physical distancing norms curbed demand for travel. It said the company’s revenue plunged around 95 percent after India imposed a lockdown in late March 2020, co-founder and CEO Bhavish Aggarwal had said at the time. This even forced the company to cut costs and lay off staff.
The report claimed that this had likely prompted a fund managed by US-based investment firm Vanguard Group to slash Ola’s valuation by 45 percent in dollar terms between December 31, 2019, and June 30, 2020. Ola was valued a little over $6 billion in 2019. This came down to around $3.3 billion as Vanguard marked down the value of its holding, according to the report.

The fund has now knocked down the value of its investment by another 9.5 percent in dollar terms. This means Vanguard reckons the cab-hailing startup is now worth around $3 billion, according to estimates by The Capital Quest.