Electric two-wheeler maker Okinawa Autotech has doubled its targeted spending to expand business operations and is in the final stage of talks with private equity companies to divest a minority stake in the company for raising funds.
Gurugram-based Okinawa, which is India’s second-largest electric two-wheeler maker, is now planning to invest between ₹800 to ₹1000 crore for doubling its manufacturing capacity to 2 million units per annum, which includes raising the capacity of motors and batteries as well.
The recalibration in spending was the reason behind the delayed conclusion of talks with private equity companies which has been going on since the middle of last calendar year. The company, which has been bootstrapped till date, was earlier planning to raise around ₹500 crore through the divestment of stake.
Jeetendar Sharma, Founder and Managing Director, Okinawa Autotech, said, “When we had done the planning earlier it was ₹500 crore but now it will be ₹800 crore - ₹1,000 crore in the next 3-4 years. We are in final discussions with PEs. The equity dilution from our side will be very minor. The promoters hold 100 per cent. This is the first time the company will dilute its stake.”
Okinawa’s expansion plans coincide with similar aggressive plans already announced by market leader Hero Electric, Ola Electric, Bajaj Auto, TVS Motor Company, Ampere Vehicles and Ather Energy to name a few.
Hero Electric is talking to investors for raising funds to increase production capacity to 5 million per annum units whereas Ola Electric has spoken about having a total capacity of 10 million per annum. Both Ather and Ampere plan the creation of 1 million production capacity each.
Okinawa presently manufactures half a dozen high speed and low-speed electric scooters from its plant in Alwar, Rajasthan. This plant has the capacity to make 1.8 lakh per annum in two shifts. The company started developing its second plant in Bhiwadi, Rajasthan around two years ago. This new plant, which has a total capacity of 1 million per annum, will see the inauguration on February 14, 2022.
“We are planning to go with two phases. In the first phase, we will have a capacity of 300,000 vehicles per year from the new plant and the second phase will see a further ramp up from there,” Sharma added.
The iPraise is one of the highest-selling models in the country. It has a range of 140km and a top speed of nearly 60 kms per hour. Okinawa’s plans to launch new products took a back seat last year due to the pandemic. This year the company is planning the launch of three products.
“One product is the high-speed scooter and the second one will be a high-speed motorcycle, which will have a speed of more than 80-90km per hour. The first product will be launched next month which will be the scooter. The second quarter of next financial year will see the launch of the motorcycle,” Sharma added.
Okinawa currently has a reach of 400 dealerships across the country which it plans to take up to 500 before the end of next financial year.