Zelio E-Mobility To Raise ₹168 Cr Via Preferential Issue

Electric vehicle (EV) manufacturer Zelio E-Mobility’s board of directors approved a proposal today to raise up to ₹167.95 Cr via a preferential issue of equity shares and convertible warrants to fund its growth initiatives.

The BSE SME listed company will issue up to 9.73 Lakh equity shares at an issue price of ₹853 per share to four non-promoter institutional and private investors, aggregating to nearly ₹83 Cr. The allottees would be Motilal Oswal Financial Services to get ₹40.1 Cr, Calliope Capital Advisors LLP (₹31.4 Cr), Param Value Investments (₹8.5 Cr), and Hem Growth Opportunities Fund (nearly ₹3 Cr). 

Simultaneously, the board approved issuing over 9.96 Lakh convertible warrants at the same issue price to three promoters, Niraj Arya, Deepak Arya, and Kunal Arya, to raise an additional sum of nearly ₹85 Cr. 

For the warrants, the promoters will pay 25% or ₹21.24 Cr at the time of allotment, while the remaining 75% (₹63.72 Cr) will be payable when the warrants are converted into equity shares. The warrants can be converted within 18 months of allotment. 

Following the full conversion of warrants and allotment of equity shares, the promoter group’s stake in Zelio will dilute from 72.8% to 70.9%, whilst public shareholding will rise from 27.2% to 29.1%. 

As the total issue exceeds ₹100 Cr, the board appointed SEBI-registered Brickwork Ratings India to monitor how the proceeds of the fundraise would be utilised in accordance with regulations. 

The company will seek shareholder approval via an EGM, which is scheduled for October 20. Separately, shareholders will be asked to approve related-party transactions of up to ₹50 Cr each with five entities — Torque Innovation EV, AVR Auto Industries, Jai Bharat Engineering Tools, Jai Bharat Auto Components, Rajdhani Machinery Store.

Zelio says these transactions will be conducted in the ordinary course of business and on an arm’s-length basis.

Founded in 2021 by Neeraj Arya, Hisar-based Zelio manufactures electric vehicles, primarily low-speed electric scooters. It operates in over 25 states with a network of more than 300 dealers. The startup made its debut on the BSE SME platform in 2025, raising ₹78.34 Cr. 

The EV manufacturer operated manufacturing units in Ladwa, Hisar, Alarpur, Cuttack and a warehousing facility in Chandan Nagar. It claims to have a footprint across 400 cities and towns across India. 

In July, the company also inaugurated a manufacturing plant in Coimbatore to expand its presence in Southern India. With the establishment of the Coimbatore factory, Zelio is now looking to enhance its manufacturing capabilities from 1.8 Lakh units per annum to 2.4 Lakh units per annum in Q2 FY27. 

“Coimbatore facility has an installed production and assembly capacity of 60,000 units per annum. During its initial phase of operations, the plant is expected to manufacture and assemble approximately 24,000-30,000 E2Ws annually, with production gradually scaling in line with market demand and operational ramp-up,” the company had said.

By the end of FY27, Zelio is looking to expand its dealership network to 550 from 400 in 25 states at the end of FY26. 

On the financial front, Zelio’s standalone profit soared 75.4% to ₹28 Cr in FY26. The EV maker set up a new auto components manufacturing subsidiary, Zelio Auto Components, in May 2025. Including the financial performance of the newly set up subsidiary, Zelio’s consolidated operating revenue for FY26 stood at ₹310.7 Cr.

Meanwhile, Zelio is not the first listed new-age tech company to return to the capital markets to raise fresh capital. Among other listed competitors in the EV space, Ola Electric raised ₹780 Cr in June and Ather raised ₹1,300 Cr in July, both utilising Qualified Institutional Placements (QIPs). Ola Electric is mulling another QIP as of now, with its board approving the raise of ₹1,500 Cr via the markets three months after raising fresh funds. 

Shares of Zelio ended today’s trading session 4.99% higher at ₹986.90.

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