Ola Electric is reportedly planning to reduce its workforce by nearly 400 to 500 employees across verticals. The decision expected to be implemented in the coming weeks is aimed at curbing operating expenses in anticipation of its proposed initial public offering (IPO), media reports said.
According to a report by The Economic Times, some of the affected employees might be replaced with new hires at a much more economical cost, however, the entire workforce is expected to decline.
Citing an anonymous source, the report said, “Inside, they (Ola Electric team) are finalising the list across different teams. Three to four teams have already finalised the numbers but the cuts would be across the organisation.”
Notably, while submitting the draft IPO papers in December last year, the firm stated that it employs 3,733 individuals as of October 2023. The employee attrition rate for the company stood a 47.48 per cent in the 2022-23 fiscal year (FY23).
Currently, the maiden listing application of the firm is being reviewed by the markets regulator, the Securities and Exchange Board of India (SEBI). The company intends to raise funds worth Rs 5,500 crore via the issue of new shares.
Earlier in April, Ola Cabs, the ride aggregator business of the Ola group, reportedly let go of nearly 200 employees. This development followed the exit of the company CEO, Hemant Bakshi, and Chief Financial Officer (CFO) Kartik Gupta.
The report quoted the source and said, “The focus across the group is to get to profitability as both units – cabs and electric vehicles – are in various stages of going public. That’s the mandate from Bhavish Aggarwal.”
The firm plans to cut jobs as part of the company’s efforts to maintain its position as the dominant firm in the electric scooter industry in the country. In May, the firm clocked sales of more than 37,000 scooters, accounting for a 50 per cent market share in the industry.
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