Ola Electric has initiated a plan to raise up to ₹2,000 crore by selling a stake in its battery subsidiary, Ola Cell Technologies (OCT), people familiar with the matter said, according to Press Trust of India (PTI).

The proposed fundraising, which is being managed by investment banks Avendus Capital and Motilal Oswal Financial Services, comes as the electric vehicle maker works to restructure operations and strengthen its balance sheet while expanding domestic battery manufacturing and energy storage capabilities, PTI reported citing sources.

OCT owns Ola’s lithium-ion cell manufacturing facility in Tamil Nadu, which currently has an operational capacity of about 1.5 GWh. The company plans to scale this capacity to 6 GWh by the end of the current financial year, according to sources cited by PTI.

The stake dilution exercise is also expected to help establish a market valuation for the battery manufacturing asset, which has not yet been determined. PTI reported that the project has attracted inbound interest from financial investors, including several sovereign wealth funds.

The gigafactory project, built with an upfront investment of about ₹3,500 crore, is seen as a step toward localising battery cell manufacturing in India. Industry participants view domestic cell production as critical for reducing dependence on imports and supporting the country’s emerging electric vehicle supply chain.

The facility is expected to support energy storage products and systems for multiple sectors beyond the two-wheeler market, according to PTI.

The company’s battery research and development activities are housed at the Ola Battery Innovation Centre, which operates under OCT. PTI reported that the centre employs more than 200 executives recruited from global corporations and has built a portfolio of nearly 400 patents.

The R&D work spans multiple battery chemistries, including nickel manganese cobalt (NMC), lithium iron phosphate (LFP), lithium manganese iron phosphate (LMFP) and lithium-manganese-rich (LMR) technologies. The centre is also working on different battery form factors such as cylindrical, prismatic and solid-state cells.

Demand for energy storage is expected to rise as India expands its renewable energy capacity. The country is targeting 50 per cent of its electricity generation from renewable sources by 2030, and the intermittency of renewable power is expected to increase the need for storage systems between generation and consumption.

Ola has already introduced residential battery energy storage systems (BESS) and plans to expand into commercial energy storage solutions, PTI reported.

The company has also developed dry electrode manufacturing technology for lithium-ion batteries. Using this process, it has created the 4680-format “Bharat Cell”, which is being produced at the gigafactory and has been deployed in Ola Electric vehicles for more than six months, according to PTI.