It seems to be a clear case of cutting on cost to improve financials rather than improving sales which is going down hill. Their consistent fall in market share seems to have spooked the management and they are not able to keep up with the cash burn.Bhavish mentions that they need to sell about 50,000 scooters but when the addressable market seems to be growing,they are not able to grow inline with it. I think they are slowly realizing 2 W EV space doesn’t have a great Moat and its getting commoditized. Unless they can come up with something like Activa for Honda,its going to be big challenge for them in the long run
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If one looks at China, it is not difficult to learn that both EV 2 wheeler and EV 4 wheeler is a business with hardly any technological moat. PPFAS did a good session on EV cars in China which has very interesting insights. It is a brutal business and only the top guys are making decent money, everyone else is losing money.
Being extremely cost efficient is very important for Ola to survive the competition and possibly thrive if there is consolidation in the market. As of now profitability still looks a reasonable distance away. Unlike Ather who are in the premium end, OLA is like Samsung in mobile phones trying to throw everything at the market and see what sticks.
Not in a hurry to invest, will continue tracking. At some point the path to profitability will be clear and that might be a good time to re-look at price and take a buying decision.
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Insolvency petition filed against Ola Electric
The developments seems to suggest a clear pattern where Ola is facing cash flow crunch as it is is losing its market share while traditional players like Bajaj ,TVS are beating them EV sales and even pure play EV players like Ather and Ampere are showing good growth while Ola sales is degrowing.
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I think the data is incorrect as OLA Electric has reported sales of over 25000 2W in Feb 2025 as told by Mr. Bhavish Aggarwal in Q3 2025 concall maintaining about 28% market share of the 2W Feb sales.
It seems the data has been intentionally engineered to make figures look poor for OLA.
I am not denying that there aren’t any challenges for OLA but if there would have been no challenges then it would not have been selling at these price levels.
Dis- Invested. Views may be biased.
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They have already clarified regarding this in a BSE press release dated 28 February 2025.
The company recently announced the renegotiation of its contracts with its vehicle registration agencies, a move that temporarily affected registration numbers on the VAHAN portal during February 2025. The negotiations aim to reduce costs and streamline the registration process.
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Interestingly the reason provided by Bhavish was "“We are renegotiating the terms of agreement with our agencies, namely Rosmerta Digital Services Private Limited " and this is the same company which has filed insolvency proceedings against Ola.
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I hope it’s just the negotiation of dues , which ola owes to Rosmeta , gone wrong.
And vendor is using legal route to get his dues, nothing wrong with that.
However I hope ola isn’t facing cash flows concerns / cash crunch/ working capital issues.
March sales units aren’t encouraging, however company hasn’t shared the backlog numbers , I think they don’t wanna catch further attention of govt. Agencies.
My sense is the units sold would be more, since just Feb backlog was pending by a good number of units.
The actual sales numbers as per vaha might not show the actual picture interns of units sold even in the month of March
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