Home-grown cab aggregator Ola is now valued at $4.2 billion going by a filing with the US Securities and Exchange Commission on July 28 by Vanguard Group .The investment management company has valued the shares at $41,577 apiece. Interestingly, the slight mark-up in the valuation came ahead of Uber announcing the sale of its China business to Didi Chuxing on August 1. Vanguard had invested $50 million in Ola in December, 2015 and had subsequently reported the per share value at $40,885 apiece. Both China’s Didi Chuxing and Japan’s SoftBank Group had invested in Ola when it raised $500 million in November last year.
Sources say the firm is scouting for more money in the region of $500 million to be able to compete with Uber. Uber Inc recently raised $3.5 billion from a Saudi Arabian sovereign wealth fund and having sold off the China business, would would look to grow market share in India, experts say.
In July last year, the company had announced an investment of $1 billion in India to expand its services and it also setup a response and support centre in Hyderabad. According to RedSeer Consulting firm, the Indian cab aggregation market is estimated at 1.2 million rides per day with Ola commanding nearly twice the market share of Uber, as of March. Ola had a marketshare of 50% as compared to Uber’s 27%, according to the RedSeer report.
Founded by Bhavish Aggarwal, Ola has cumulatively raised $1.25 billion from investors such as Tiger Global, DST, Softbank among others.
While the taxi aggregators are fighting a legal battle having accused each other of violating transportation rules, the companies have been pulled by several state governments including Karnataka and Delhi. The state governments reportedly want them to charge customers by the meter rather than use the GPS system.
Ola which has about 3.5 lakh cabs and one lakh autos on its platform, is looking to double the cabs on its platform by end of this fiscal. It has a presence in 102 cities as compared to 27 locations of Uber. For FY15, the taxi aggregator registered a revenue of R380 crore which was a seven-fold increase over last fiscal even as the losses rose 20 times to touch R754 crore.