Ola Electric Battles Falling Revenue and Mounting Losses as Unit Economics Worsen
Ola Electric is still struggling financially as its revenue fell 39% YoY to INR 421 cr in Q2 FY27, the ninth consecutive quarter of losing revenue. It narrowed losses to INR 362 cr, but its adjusted EBITDA margin declined.
Ola Electric Mobility Ltd, headed by Bhavish Aggarwal, has witnessed a fall in revenue for eight consecutive quarters. Additionally, the electric two-wheeler maker's operational profit margin (profit before interest, taxes, depreciation, and amortisation) declined year over year in the September quarter due to the company's struggles to compete with rivals. Sales for the Bengaluru-based firm fell 39% year-on-year to INR 421 crore.
But in the second quarter of FY27, their losses decreased to INR 362 crore from INR 418 crore the previous year. From -37.4% in the prior-year period to -58.5% in the current one, its stated adjusted operating earnings before interest, tax, depreciation, and amortisation (Ebitda) margins got worse.
Ola’s Opponents Marching Ahead in the Race
Ola's unit economics took a nosedive right as competitor Ather Energy Ltd announced its maiden net profit. The electric two-wheeler division of Pune-based Bajaj Auto Ltd. was also reported to be adding positively to Ebitda by double digits. Ather, headquartered in Bengaluru, turned a profit of INR 1.26 crore after taxes in the third quarter of 2018 compared to a loss of INR 154 crore in the same period last year. Sales increased by 63% to 1,526 crore Indian rupees.
Compared to -9.6% a year before, its Ebitda margin was 4.9%. Ola Electric is putting its money on the fact that its cell business will rebound in the next quarters and that its dealership network will grow from 319 stores to 700 stores by the end of March. Its wholesale order forecast for December is at 20,000, up from 3,955 in September. According to the company's declarations, all of its stores have likewise been closed. In addition, it has added 6 GWh capacity for its cell plant in preparation for increasing plant utilization and so beginning to generate income. This revenue would mostly originate from Ola's own auto company, as the scooters and motorbikes will be powered by in-house cells.
EV Race Heating Up in Indian Market
Commencing in the March quarter of the current fiscal year, the Ola aims to reclaim market share with a product with a 300-kilometer range. Nevertheless, it is confronted with competition from Bajaj Auto, TVS Motor Co. Ltd., Ather Energy, and Hero MotoCorp Ltd., all of whom have increased their own expansion efforts. Ola Electric has registered 122,890 units, according to data from the government's Vahan webpage for 2026. But Hero MotoCorp, its main competitor, has already registered 213,372 units.
Ola Electric has a formidable struggle as it attempts to regain market share, with Ather's 306,012, Bajaj's 420,857, and TVS's 492,424 unit registrations as evidence. During the earnings call, the company's management mentioned that scooter manufacturing is increasing due to dealers placing repeat orders and reporting improvements in market share in some markets. Since its listing price in August 2024 was less than half of its current price, investors are keeping a careful eye on the company's recovery attempts.
