US-based asset management company Vanguard has marked down Ola’s valuation to $1.25 billion, according to an SEC filing. This represents more than 80% drop from its peak valuation of $7.3 billion in 2021.
In February last year, Vanguard had for the first time valued the Bhavish Aggarwal-led company below the $2-billion mark — at $1.88 billion. However, it later revalued the company at around $2 billion in November.
The latest development comes as Ola continues to lose ground in the ride-hailing space. Rapido has emerged as the market leader, rapidly expanding market leadership in bike taxis to its auto rickshaw and cabs business, followed by Uber, with Ola now relegated to the third spot.
In August last year, CEO Bhavish Aggarwal announced that Ola Cabs would be rebranded as Ola Consumer, consolidating its financial services, cloud kitchens, and electric logistics under one umbrella. Although Ola converted into a public entity in November last year and has been evaluating IPO options since, it has yet to make concrete moves toward a listing.
During FY24, Ola’s operating revenue declined by 5.5% to Rs 2,012 crore, down from Rs 2,128 crore in FY23. However, the company significantly narrowed its losses to Rs 10 crore in FY24, compared to Rs 623 crore in the previous fiscal. The Bengaluru-based firm also turned Ebitda-profitable in FY24. Last year, the company exited all international markets, including the UK, Australia and New Zealand.
Its rival Rapido reached the unicorn status last year after raising $200 million at a valuation of $1.1 billion. The Swiggy-backed company also surpassed Ola in terms of combined daily rides across bike taxis, autos and cabs.
Despite losing market share, Ola’s ride-hailing business remained more than twice the size of Uber’s and 2.5 times that of Rapido in terms of revenue. In FY24, Ola’s ride-hailing income stood at Rs 1,761 crore, compared to Uber’s Rs 807 crore from its mobility operations. Rapido reported Rs 648 crore in revenue for the same period, while managing to cut its losses by 45% to Rs 371 crore.