Valuation
Valuation
Valuation
5 Y CAGR 106.19%
FY 22 FY23 FY24
India 2W Production Volume (Millions) 17.91 19.51 21.46
Market share of E2W in India (%) 3.4 4.5 5
OLA Market share (%) 34.8
India 2EW Volume (Million) 1.08
Ola Volumes (Million) 0.37
Ola Volumes (Units) 20,948 1,56,251 3,29,651
Ola Per unit price incl. PLI (₹) 2,17,777 1,78,085 1,59,000
Ola Revenue (₹ Cr) 456 2,783 5,241
Ola Variable Cost (₹ Cr) 995 3,391 5,850
Variable Cost per unit (₹/unit) 4,75,158 2,17,025 1,77,458
YoY Reduction in PU variable costs (%) 54.3 18.2
Fixed Costs (₹ Cr) 349 702 983
Total Costs (₹ Cr) 1,344 4,093 6,833
Profit (₹ Cr) (EBITDA) -1,592
z
FY18 FY19 FY20 FY21
23.02 24.46 20.94 18.40
4.04 4.05 3.45 3.12
0.95 1.11 0.78 0.62
1.02 1.27 1.14 0.61
29.02 30.90 26.31 22.74
0.62%
1.70%
FY29E
31.20
26 (EV adoption rate, according to IBEF)
34.8 (atleast 30%of vehicles to be ev by 2030
8.11 5 YEAR CAGR OF 100% Ola’s Market Share is difficult to project, we have ass
2.82 (Economies of scale ) High production capacity
2825000 Sales growth is excellent, and the firm is building scale that will help it lower costs and
1,75,000
49437 Ola will be able to reduce Variable Cost per unit by own manufacture and scale benefi
34815 Total absolute Variable Costs rise proportionally to volumes but at projecte
123240
5
4016
38831
10606
re is difficult to project, we have assumed it stays at 34.8%.
Mar-23 Mar-24
1,218.88 2,491.06
194.34 1,272.18 795.63
507.18 712.62
424.18 205.44 223.29 1,018.92
OLAELEC.NS
Peers used for Relative Valuation:
OLECTRA GREENTECH
BAJAJ AUTO
HEROMOTOCORP
EICHERMOT
TVS
JBM
EV/EBITDA P/E
2024A 2024A
OLA ELECTRIC -35.3914449 -17.69
BAJAJ AUTO 28.9637111 33.95
HERO MOTOCORP 20.9639765 28.45
EICHER MOTORS 25.3351769 34.02
TVS MOTORS 37.8911146 75.43
JBM AUTO 46.4248357 126.56
OLECTRA GREENTECH 100.927078 179.13
Average 43.4176488 79.59
Median 33.4274128 54.725
Average EV/EBITDA 43.41764876
EBITDA of OLA 1,021
EV 44329.41938 222666673.5
Bajaj Auto JBM AutoOlectra Greentech
36,455 3,857 1,091
8,167 426 154
5,986 124 66
2,71,758 23,046 13,762
Minority Interest 0
JV and Associates
Net defined benefits
EV 36,594.75
Multiple Calculation:
EBITDA:
2024A
Average -1,034
EV/EBITDA -35.39144487
Sales
329618
EV/EBITDA Multiple
EV 255,604.75
Multiple Calculation:
EBITDA:
2024A
Average 8,825
EV/EBITDA 28.96371105
EV/EBITDA Multiple
EV 95,407.06
Multiple Calculation:
EBITDA:
2024A
Average 4,551
EV/EBITDA 20.96397649
Sales
3733931
EV/EBITDA Multiple
Minority Interest 0
JV and Associates
Net defined benefits
EV 110,309.36
Multiple Calculation:
EBITDA:
2024A
Average 4,354
EV/EBITDA 25.33517685
EV/EBITDA Multiple
EV 104,200.57
Multiple Calculation:
EBITDA:
2024A
Average 2,750
EV/EBITDA 37.89111455
EV/EBITDA Multiple
EV 19,776.98
Multiple Calculation:
EBITDA:
2024A
Average 426
EV/EBITDA 46.42483568
LBO Modelling
₹ in Cr.
EBITDA FY28 4,453
EBITDA FY+1 (2029) 6,949
Assumed Valuation (FY+1 EV/EBITDA) 43.4x
Assumed Leverage Level (LTM EBITDA 5x
LBO Net Debt (Total) 22,265
Senior Debt 4.5x 20,039 5.50% 7 years
Sub Debt 1.5x 6,680 7.50% 8 years
Enterprise Value 44,329
Equity Value in BS 22,064
50%
Cash Outflow & Debt
Summary:
TATA Motors will use a Leveraged Buyout method to acquire 50.22% of Ola Electric which is valued at 44000 Cr. u
688
1,102
501
7.20% Average Cost of debt
2028 2029
1,742.50 1,742.50
1,000.00 1,000.00
2051.749437 3775.219
EV 15,542.77
Multiple Calculation:
EBITDA:
2024A
Average 154
EV/EBITDA 100.9270779
Mar 2021 Mar 2022 Mar 2023 Mar 2024
Sales - 1 373 2,631 5,010
Sales Growth % 43321% 605% 90%
Other Income + 98 83 55 226
Total Revenue 99 456 2,686 5,236
Total Expenses - 278 1,174 3,883 6,276
Material Cost % + 0% 129% 98% 87%
Cost Of Materials Consumed 584.93 2,504.79 4,390.91
Manufacturing Cost % 2003% 23% 4% 5%
Employee Cost % 22936% 76% 16% 9%
282.48 426.73 438.87
Other Cost % 7388% 86% 29% 24%
410.43 886.24 1,459.02
Operating Profit -277 -800 -1,252 -1,266
OPM % -32228% -214% -48% -25%
0.846615253
Mar 2024
12
58
112
-43
-34
Weighted Average Cost of Capital
Risk Free Rate (Rf) 7.37% 10 year G sec Market Return
Beta(Tata Motors) 0.596 Particulars
Beta(Ola) 2.10
Expected Market Return (Rm) 16.95% 1-Oct-14
Cost of Equity (Rf+Beta*(Rm-Rf)) 27.53% 1-Oct-19
1-Oct-21
Pre-Tax Cost of Debt 10.50% 1-Oct-23
Tax Rate 5% 18-Oct-24
Post-Tax Cost of Debt 9.98% 1 yr Market
3 yr Market
Equity 3,355 5 yr Market
Debt 3,355 10 yr Marke
Total Capital 6,710