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Informist, Monday, Jul. 14, 2025

By Anand JC and Shakshi Jain

NEW DELHI – Ola Electric Mobility Ltd. Monday said that the electric vehicle industry was now entering a phase of consolidation, having seen agressive growth over the past few years. The industry could grow around 20% this financial year and aggressively next year onwards once again, Ola Electric's management told analysts in a post-earnings conference call. The company expects to grow at, or above industry's growth rate.

"The mass middle segment customer is now considering electric vehicles actively in our own (brand) surveys," the company said, adding that the consideration for electric vehicles remains high even as customers wait out a generation of electric vehicles to ease anxieties around range, among other issues. 

The Bengaluru-based mobility company reported its earnings early Monday. Its deliveries fell to 68,192 units in the June quarter from 125,198 units in the base quarter but higher than the 51,375 units in the March quarter. While its deliveries contracted year-on-year, gross margin figures jumped. The company's consolidated gross margin for the June quarter was 25.8%, compared with 13.7% in the March quarter and 18.4% in the base quarter.

This figure does not include any benefits from the Centre's production-linked incentive scheme. "Some of the gross margins are still to be realised," the company said. It expects gains from the Gen3 platform to play out in this financial year.

Ola Electric, a beneficiary of the Centre's production-linked incentive scheme for advanced chemistry cell, has been lagging behind mandated targets. The company during its analyst call for the December quarter had guided for launching its battery cells in the June quarter.

The management said it will not be able to meet the mandated timelines. "We will engage with the government to probably relook at some of these timelines and in the broader interest and encouragement to industry, probably relook at those timelines," it said. The penalty for missing the target is a maximum of around INR 1 billion, which Ola Electric said it has been accruing for in its books every quarter.

The cell manufacturing operations will ramp up through this year. While the company's margins will have a small component of cell business this year, the real cell savings at scale will be seen majorly in the next financial year, the company said.

Ola Electric's cash balance as of Jun. 30 was INR 31.97 billion, compared to debt of around INR 20 billion excluding short-term borrowings. "We will be refinancing some of the debt (except the term loans) and are in discussions with various lenders through our investment bankers and expect this to close by next quarter," the company said in a presentation to its investors.

The company said its business model has registered delivery backlogs in the last two-three years. A traditional business model in comparison, does not prefer very large backlogs and finishes off deliveries in three-four days. "For us, even now, it is higher than that. And that is actually a room for improvement to drive more volumes itself," the company said. Ola Electric expects to improve its delivery backlog situation, which in turn could create some incremental demand, its management said.

Ola Electric aspires to sell around 325,000-375,000 electric two-wheelers this year. Of this, it expects around 15-20% of sales to be driven by the Roadster series of its electric motorcycles.  

For the June quarter, Ola Electric reported a consolidated net loss of INR 4.28 billion on revenues of INR 8.28 billion. Monday, its shares ended 18.3% higher on the National Stock Exchange at INR 47.07.  End

Edited by Akul Nishant Akhoury

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