S&P Downgrades Ola Cabs Parent ANI Tech On Liquidity Woes, Negative Cash Flow

S&P Global Ratings has downgraded ANI Technologies Pte. Ltd., the promoter group of Ola Electric Mobility Ltd., citing dwindling cash reserves and sustained negative operating cash flows. ANI Technologies, which operates Ola Cabs, may face a sharp liquidity crunch and is unlikely to withstand adverse events, the rating agency said on Monday.

The ride-hailing platform has seen rising competition, forcing increased spending on incentives to retain market share. This has resulted in negative EBITDA and cash flows after two years of profitability, S&P noted in a report. The agency cut ANI Technologies' rating to ‘CCC+’ from ‘B-’ and maintained a negative outlook, citing weakened liquidity due to continued cash burn.

Bhavish Aggarwal, chairman and managing director of ANI Technologies, also heads Ola Electric. The cab aggregator reportedly holds around 4% in the electric two-wheeler company.

ANI Technologies has been eyeing a public listing since 2020, but The Economic Times recently reported a delay beyond its latest 2026 deadline. S&P warned that adverse market conditions, business weakness, and uncertainty in leadership due to high management churn may hurt its chances of securing an IPO extension.

If ANI Technologies fails to get that extension, holders of compulsorily convertible preference shares could exercise their rights, the agency said. As of March 31, 2023, the company had about ₹195 billion in such instruments, accounting for nearly 95% of its adjusted debt.

S&P added it could lower the rating further if the company's cash position worsens in the next three to 12 months due to ongoing operating losses with no clear path to profitability.