On Wednesday, IFC announced that it will invest Rs 600 crore in a new last-mile mobility (LMM) company, a subsidiary of Mahindra & Mahindra that will be newly incorporated (NewCo).
As IFC’s first investment in an EV manufacturer, and the first in electric three-wheelers globally, it will be in the form of compulsory convertible instruments worth up to Rs 6,020 crore.
As a result of the Rs 600 crore investment, IFC will own between 9.97 percent and 13.64 percent of NewCo.
The last mile mobility division will be housed at NewCo, which will include three-wheelers (Alfa, Treo, Zor) and four-wheeled SCVs (Jeeto).
As part of our commitment to being a Planet Positive by 2040, we will electrify the last mile mobility business at scale. Anish Shah, MD and CEO of Mahindra & Mahindra, said that micro and women entrepreneurs will also benefit greatly from this.
By 2030, India aims to reduce its emissions by 45 percent and achieve 80 percent EV penetration for two- and three-wheelers, 70 percent for commercial vehicles and 30 percent for private vehicles.
IFC’s Regional Director for South Asia, Hector Gomez Ang, said, “India is the largest three-wheeler market worldwide, and this investment marks a significant step towards scaling up domestic production of electric vehicles catering to this segment and small commercial vehicles.”
Rajesh Jejurikar, Executive Director and CEO (auto and farm sector) at Mahindra & Mahindra, the market leader in this segment, stated: “We have a chance to drive higher EV penetration in this segment and provide microentrepreneurs with a profitable and sustainable option.”
The International Finance Corporation (IFC) is a member of the World Bank Group. In fiscal year 2022, IFC committed a record $32.8 billion to developing country companies and financial institutions.
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