Ola Electric Gets INR 73.7 Cr Incentive Under PLI Auto Scheme: Report 

Update | March 06, 03:45 PM

Listed EV major Ola Electric, in an exchange filing on March 5, informed the heavy industries ministry has approved a payment of INR 73.74 Cr to Ola Electric Technologies as part of the PLI-Auto Scheme.

The company said, “The payment of INR 73,74,36,612/-has been sanctioned towards the incentive for the Determined Sales Value of FY 2023-24, as per existing terms and conditions of the PLI Auto Scheme, as amended from time to time.”

Original | March 05, 06:35 PM

Listed EV major Ola Electric has reportedly become the first two-wheeler EV manufacturer to receive incentives under the Centre’s PLI Scheme for automotive and auto components. 

A Moneycontrol report said that the company has been granted an incentive of INR 73.7 Cr based on its sales for the financial year 2023-24. 

Ola Electric declined to comment on the development.

As per Vahan portal, Ola Electric’s total EV registrations stood at 3.29 Lakh units in FY24 as against 1.52 Lakh units in FY23.

It is pertinent to note that the company secured PLI certificates for all its 5 products in the premium as well as mass-market segment last year. 

The certification made the Bhavish Agarwal-led EV maker the first company to get products certified under the PLI scheme for auto, the company said then. It met the 50% domestic value addition criteria set by the heavy industries ministry (MHI) to get these certifications. 

Launched in September 2021, the PLI scheme for auto and auto components has a budget allocation of INR 25,938 Cr over 5 years. It aims to enhance domestic manufacturing incentivising companies to increase their production and exports. 

Ola Electric has also been a beneficiary of other government schemes like FAME-II, PLI scheme for advanced chemistry cell battery storage, and PM E-DRIVE.

Just a day ago, the company, alongside Reliance and Rajesh Exports, received notice from the MHI for failing to meet its commitments under the PLI scheme for battery storage. 

The developments come at a time when the company is grappling with rising competition, increasing losses, and falling share prices. Amid these, it has taken a number of measures, including cutting 1,000 jobs, to save costs and cut its expenses.

A recent report by NDTV Profit said that the company has decided to process vehicle registrations in-house to further save costs. 

The report said that Ola Electric has established an in-house team to process vehicle registrations at INR 300 per vehicle, which is one-fifth of the cost charged by its vendor Rosmerta Digital Services Pvt. Ltd. at INR 1,500-1,800 apiece. 

Last month, the company informed the exchanges that it was in the middle of renegotiating its existing deal with service providers Rosmerta Digital Services and Shimnit India Pvt Ltd, and this may  temporarily impact its EV registration for February.

As a result, Vahan data showed that Ola Electric’s vehicle registrations stood at just 8,390 units in February. However, the company claimed that its sales stood at over 25,000 units last month.

Shares of Ola Electric ended Wednesday’s (March 5) trading session 1.75% higher at INR 56.93 on the BSE.