MUMBAI: Ola Cabs is laying off 10%, or nearly 200 employees, as part of a restructuring ahead of its planned initial public offering (IPO), sources said. The company intends to submit draft IPO documents to the Securities and Exchange Board of India (SEBI) within three months and list on stock exchanges later this year. The move has largely impacted support teams, which is also due to the company’s increased focus on implementing artificial intelligence (AI) in its operations, while core technology and product teams are understood to have been unaffected by the downsizing process. In a letter to employees, reviewed by TOI, founder Bhavish Aggarwal said the restructuring is aimed at “improving profitability” and preparing the company for the “next phase of growth”.
In a separate development, the Bengaluru-based company’s CEO Hemant Bakshi resigned within three months of joining the company. Ola Cabs refused to comment. Aggarwal said Bakshi is leaving to pursue opportunities outside the company.
The job cuts result from the company’s efforts to build a leaner team structure and sustainability. The company claims that it has already seen a standalone operating profit of Rs 250 crore in FY23 as against losses of Rs 66 crore in the same period a year ago. “Profitability is a lucrative proposition for public markets and the company wants to continue to build on it,” said a source aware of the company’s thinking. Aggarwal said the company has made significant investments in the areas of artificial intelligence and technology, which has led to significant cost advantages. “…We will continue to focus on these areas to ensure we create leading-edge products and services across all verticals of our business. These changes will make some positions in the company redundant,” Aggarwal said.
The Ola Electric subsidiary has already filed draft IPO documents with SEBI and aims to raise Rs 5,500 crore by issuing modern shares.
In a separate development, the Bengaluru-based company’s CEO Hemant Bakshi resigned within three months of joining the company. Ola Cabs refused to comment. Aggarwal said Bakshi is leaving to pursue opportunities outside the company.
The job cuts result from the company’s efforts to build a leaner team structure and sustainability. The company claims that it has already seen a standalone operating profit of Rs 250 crore in FY23 as against losses of Rs 66 crore in the same period a year ago. “Profitability is a lucrative proposition for public markets and the company wants to continue to build on it,” said a source aware of the company’s thinking. Aggarwal said the company has made significant investments in the areas of artificial intelligence and technology, which has led to significant cost advantages. “…We will continue to focus on these areas to ensure we create leading-edge products and services across all verticals of our business. These changes will make some positions in the company redundant,” Aggarwal said.
The Ola Electric subsidiary has already filed draft IPO documents with SEBI and aims to raise Rs 5,500 crore by issuing modern shares.
