Bhavish Aggarwal Injects ₹20 Crore to Shield Ola Electric Collateral Amid Stock Slump

Bhavish Aggarwal, founder and CEO of Ola Electric Mobility Ltd., injected nearly ₹20 crore ($2.3 million) in cash to top up collateral for loans taken against Ola Electric shares.

This move came as the company’s stock price dropped amid underwhelming sales performance, according to individuals familiar with the matter. The funds were added since March, following a dip in share value below ₹50 each.

The capital injection was made voluntarily and no margin calls were triggered. Sources confirmed that the stock collateral remains worth over twice the borrowed amount.

Raising Capital for Krutrim via Pledged Shares

Aggarwal had previously secured ₹250 crore for his generative AI startup, Krutrim Data Center Pvt., by pledging equity from Ola Electric.

This financing was done through bonds issued by Krutrim, with interest rates ranging between 14.9% and 15.9%, and backed by shares of Ola Electric.

The lenders for this transaction included Avendus Group, InCred Alternative Investments Pvt., and Modulus Alternatives Investment Managers, as per Bloomberg data and one of the sources.

Ola Electric’s shares, which debuted at ₹76 in August, have lost around 35% of their value. Investors are closely monitoring the company, which is backed by Japan’s SoftBank Group Corp.

The recent stake reduction by Hyundai Motor Co. and Kia Corp. followed Ola Electric’s disclosure that its quarterly losses had more than doubled. The company has also been under scrutiny for issues related to governance and regulations.

Collateral Adjusted Through Interest Prepayment

As Ola Electric’s stock value declined, Aggarwal chose to cover three to four months of accrued interest with cash, instead of increasing the share collateral, according to one of the individuals.

This strategy helped maintain the loan’s structure without diluting his equity stake further.

Aggarwal had already earned approximately ₹280 crore by selling a part of his Ola Electric holdings during the IPO.

Despite the company’s stock trading close to ₹50 last Thursday, the cash top-up is unlikely to be refunded due to continuing concerns regarding Ola Electric’s business performance.

Stake Pledges and Market Reaction

Data from the stock exchange indicates that Aggarwal has pledged or otherwise encumbered nearly 8% of his 30% shareholding in Ola Electric.

While Avendus and InCred declined to comment, Modulus Alternatives did not respond to a Bloomberg email seeking their view.

Ola Electric, in a statement, noted that all founder pledges had been disclosed and that there were no material developments to report. The company also dismissed the latest reports as “speculative.”

Even as Aggarwal proactively addressed the falling share price through a cash infusion, the market remains cautious.

The e-scooter company’s performance has continued to decline, with its market share plummeting to 18% in May, a sharp drop from over 48% in the same period last year.

Market Outlook and Shareholder Vigilance

With its IPO once hailed as a milestone for the Indian electric vehicle sector, Ola Electric is now navigating a turbulent period marked by falling market share, increasing losses, and governance-related concerns.

The situation has prompted aggressive scrutiny from shareholders and institutional investors alike.

Although Aggarwal’s commitment through collateral management and interest prepayment signals confidence, the stock’s continuing decline and operational struggles remain a point of worry.

Ola Electric’s listing was anticipated to propel India’s e-mobility industry, but investor sentiment has shifted in light of recent developments.

Aggarwal’s financial maneuvering reflects attempts to shield both Krutrim and Ola Electric from added pressure as they undergo strategic and regulatory challenges.

As Ola Electric copes with a drop in stock value and shrinking market share, Bhavish Aggarwal’s cash collateral top-up highlights a proactive but cautious approach to preserving his financial commitments.

Despite securing ₹250 crore for Krutrim through pledged shares, and having earned from the IPO, the founder remains entangled in the fallout of Ola Electric’s declining performance.

With no margin calls yet and the stock collateral remaining significantly above the borrowed value, the situation remains stable for now—but continued investor scrutiny and company performance will ultimately determine the next phase for Aggarwal and his ventures.