S&P rates Ola, loan B-

S&P said it gave preliminary B- ratings to ANI Technologies Pte. Ltd., the operator of ride-hailing platform OLA Cabs, and its planned $500 million senior secured term loan. The loan will be issued by 100%-owned subsidiary Ola Netherlands BV.

“The rating reflects our expectation that ANI Tech's liquidity will cover the company's loss-making operations until at least fiscal 2024 (ending March 31, 2024). ANI Tech's operations should gradually strengthen and turn EBITDA positive by fiscal 2024. We estimate the company's annual EBITDA losses to be at least Indian rupee Rs. 5 billion over the next two years. Together with planned investments in its business, the company is likely to report negative annual free operating cash flow of about Rs. 14 billion over the same period,” S&P said in a press release.

The proceeds will be used to add to the company’s liquidity. The agency noted the company is closing its third round of pre-IPO capital raising and plans to go public in fiscal 2023.

The outlook is stable.

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