Ola restructuring biz over IPO to cost 250 jobs: Report
by PTIRide-hailing major Ola is undertaking a restructuring exercise ahead of its planned IPO and the move could impact up to 250 roles, according to sources.
The company, which has been focussing on profitability along with building up scale as it expands into international markets, will accommodate some of these employees in other business units like food, electric and financial services, sources close to the development said
When contacted, an Ola spokesperson said the company's "organisational redesign aims to rightsize all our operations as well as leverage skills sets and experience of mobility employees in available positions in new business verticals".
The spokesperson, however, did not comment on the number of employees that could be impacted by the exercise.
Ola is estimated to have about 4,500 people on its payrolls.
"The resultant working model will form the foundation of the next chapter in Ola's growth journey as the company continues to grow its businesses. We also continue to attract the best talent across the board to support our growth and ambition," the spokesperson said.
The spokesperson added that the restructuring is aimed at becoming "more nimble and have a sharper focus on growth and profitability".
The development comes at a time when Ola, which is locked in a battle for market leadership in the Indian market against American rival Uber, narrowed its standalone losses in FY19 to Rs 1,160.27 crore from Rs 2,676.70 crore in the last financial year.
ANI Technologies (which runs Ola) saw its total income rising close to 16 per cent to Rs 2,155.21 crore in FY19 from Rs 1,860.61 crore in the previous fiscal, as per regulatory documentrs filed with the Corporate Affairs Ministry.
Its employee benefits expense has been lowered to Rs 413.83 crore in FY19 from Rs 495.69 crore in FY18.
These are standalone numbers of ANI Technologies and do not include financials of other group entities like OLA Fleet Technologies, Ola Financial Services (Ola Money), Ola Electric Mobility, and international operations.
Sources said Ola is looking at listing on Indian bourses in the next 18-24 months, and profitability would be an important criteria for the process.
Ola can get listed on the BSE and NSE either directly or via Securities and Exchange Board of India-regulated Innovator’s Growth Platform (IGP) for SMEs and startups.
An IPO will help Ola investors like SoftBank, Tiger Global and Steadview Capital to exit or partially sell their stake in the company to return funds to their shareholders.
Founded in 2011 by Bhavish Aggarwal and Ankit Bhati, Ola offers services in more than 110 cities and claims to have over 10 lakh driver-partners across cabs, auto-rickshaws, and taxis on its platform. In 2018, Ola forayed into international markets like Australia, the UK and New Zealand. It competes with Uber in these markets as well.