14 Jul Ola Electric Q1: Revenue halves, losses widen to Rs 428 crore
But sequentially, the company posted a narrower loss and higher operating revenue, and said its automotive business turned Ebitda-positive in June, helped by cost-reduction efforts and improved gross margins, sending its shares to close more than 18% higher on Monday.
The company posted a net loss of Rs 428 crore on revenue of Rs 828 crore for the quarter ended June 30. While net loss widened from Rs 347 crore a year earlier, it narrowed to less than half from Rs 870 crore in the January-March quarter. It had posted operating revenue of Rs 611 crore in the March quarter.
Vehicle deliveries — the number of electric two-wheelers registered and handed over to customers — dropped to 68,192 units from 1,25,198 units a year earlier. Sales volume was, however, better from the previous quarter when it sold 51,375 units.
Gross margin improved to 25.6% from 18.4% last year, driven by cost rationalisation, the company said.
Expenses fell 42.4% year-on-year to Rs 1,065 crore, mainly due to an Rs 870 crore reduction in material costs. Employee expenses declined to Rs 89 crore from Rs 123 crore.
“We have transitioned from aggressive penetration to a more balanced, profitable growth strategy,” founder and managing director Bhavish Aggarwal said on an earnings call. “The industry is consolidating after a hyper-growth phase and will see another surge in the near future. Until then, it’s time to consolidate operations.”
While EV sales continue to grow faster than those running on fossil fuels, growth has moderated compared to FY23, FY24 and early FY25, he said.
Under its cost-reduction initiative ‘Lakshya’, the company reduced monthly automotive operating expenses from Rs 178 crore to Rs 105 crore.
Shares of Ola Electric closed at Rs 47.10 on the BSE Monday.
The company has faced scrutiny in recent months over discrepancies in reported sales data, quality concerns, and missing trade certificates at retail outlets.
Once the market leader, Ola Electric’s market share has dropped to 16.8% in the electric two-wheeler segment in the first 14 days of July, putting it behind TVS Motor and Bajaj Auto, according to data from the government’s Vahan portal. It had a market share of more than 50% a year ago.
The company sold 18,527 units in June and around 6,100 units in the first 14 days of July.
Rare earth magnet issue
Ola Electric flagged rare earth magnet supply as a long-term challenge for automotive manufacturers.
“On rare earth magnets and ABS magnets, we have our own solutions since we are vertically integrated,” Aggarwal said. “We are working with alternative suppliers and will introduce a rare earth-free motor in the next quarter.”
Cell production
The EV company has started producing battery cells to be deployed in vehicles starting this Navratri. Transition from supplier-sourced cells to in-house 4680 cells will begin this quarter and continue through FY26, it said.
By the end of FY26, Ola Electric aims to fully utilise its 1.4 GWh cell capacity and scale up to 5 GWh in FY27. The total budget for the 5 GWh plant is Rs 2,800 crore, backed by a State bank of India-led consortium. So far, the company has invested Rs 1,500 crore.
Aggarwal said Ola does not expect to expand capacity beyond 5 GWh until at least FY29.
Market outlook
Ola Electric expects to deliver 325,000–375,000 vehicles in FY26, generating revenue of Rs 4,200–4,700 crore. Ola is banking on festive season demand and the ramp-up of its Gen-3 scooters and Roadster bikes to drive growth.
In May, the company’s board approved plans to raise up to Rs 1,700 crore via non-convertible debentures and other debt instruments, its first fundraising move since its IPO last August to support operations and strengthen its balance sheet.
“We do have some debt obligations. We will be refinancing a portion of that corporate debt — not the term loans — that we had taken before our IPO,” Aggarwal said.
The company has begun deliveries of its Roadster X electric motorcycles in the past quarter. Aggarwal said the bikes are generating strong interest and will be available at nearly all Ola stores during the current quarter.