Ola, an Indian ride-hailing startup, has seen its valuation slashed by its financier Vanguard amid a weakening global economy that has significantly affected the market caps of numerous public companies.
Vanguard downgraded the valuation of Ani Technologies, Ola’s holding company, by 35% from the end of February, it announced in its semi-annual report to investors. The US index fund pioneer has reduced holdings of its Ola shares to $33.8 million, from the $51.7 million purchase price, according to an analysis of its filings.
During the same period, Vanguard’s growth fund reported an increase in the value of its investments in India’s Housing Development Finance Corp and L&T holdings, while the value of its HDFC Bank shares fell slightly.
Vanguard’s updated valuation of Ola shares lowers the value of the Indian ride-hailing startup to about $4.8 billion, down from $7.3 billion at the end of 2021. Ola was previously valued at $5.7 billion in a private financing round in January 2019.
A spokesperson for Ola declined to comment.
The Bengaluru-based company joins a growing list of high-profile Indian startups that have had investor valuations downgraded. Invesco cut Swiggy’s valuation by nearly half to $5.5 billion in January this year, while Blackrock cut Byju’s valuation by nearly half to $11.5 billion the previous year.
Recent valuation cuts shed new light on the impact of deteriorating global market conditions on Indian start-ups. Last year saw a dip in funding activity within India’s startup ecosystem, but valuations of much larger startups remained unchanged as they either raised capital through convertible bonds (thus delaying price discovery) or chose not to raise funds at all.
It is important to note that investors evaluate the asset value of their existing startup portfolios in different ways. As a result, a significant valuation adjustment by a single investor does not necessarily reflect the views of other investors, and in some cases, even the startups themselves.
