Ola Electric’s Q3 Loss Zooms 50% YoY To INR 564 Cr

Bhavish Aggarwal-led Ola

Electric’s consolidated net loss widened 50% to INR 564 Cr in the third quarter of the fiscal year 2024-25 (Q3 FY25) from INR 376 Cr in the year-ago quarter, hurt by lower revenue due to rising competition in the electric two-wheeler market.

On a quarter-on-quarter basis, net loss rose 14% from INR 495 Cr amid declining electric vehicle (EV) sales.

Ola Electric earned all its revenue from the sale of its escooters in the reported quarter. Till FY24, the Ola S1 Pro model was the biggest revenue driver for the electric mobility company. 

Its operating revenue declined 19% to INR 1,045 Cr during the quarter under review from INR 1,296 Cr in Q3 FY24. Sequentially, it fell 14% from INR 1,214 Cr.

As per the company’s Q3 filings, Ola Electric delivered 84,029 escooters in the December quarter of FY25, down a little over 3% from 86,775 EV units delivered in the same quarter last year. However escooter deliveries fell nearly 15% from 98,619 units. 

In a shareholders’ letter, the electric mobility company said, “Despite increased competitive intensity, Ola Electric retained the #1 market share at 25.5%, driven by our technology leadership, strong product portfolio, and expanding service footprint.” 

It is pertinent to note that Ola Electric began losing some of its market share to rivals TVS Motor, Bajaj Auto and IPO-bound Ather Energy in July last year. In December 2024, it lagged behind TVS and Bajaj in terms of escooter sales. 

In January 2025, however, Ola reclaimed its top spot in India’s electric two-wheeler market, overtaking both TVS and Bajaj. As per Vahan data, Ola Electric held a market share of 25% in the two-wheeler EV space in January.

Ola Electric attributed the weak Q3 performance to high competitive intensity and service challenges. The company said that it has resolved the service issues and turned the tide on market share and margins by expanding its store network.

“In January, we’re back to market leadership with an expected gross margin of approx 26%, up from 20.4% in Q3 FY25,” it said.

The electric mobility company said that its gross margin in the auto segment expanded by 20 basis points QoQ to 20.8% in the December quarter despite a decline in revenue, driven by lower BOM costs and the benefit of the production-linked incentive (PLI) accruals across products.

In an exchange filing, along with its December quarter earnings, Ola Electric said it has obtained the board’s approval to provide a corporate guarantee of up to INR 250 Cr to its wholly-owned subsidiary Ola Electric Charging Private Limited.

The corporate guarantee will be given in favour of the Bank of Baroda to support Ola Electric Charging’s application for a government tender related to its business.

Zooming Into Expenses

The listed electric two-wheeler maker managed to bring down its overall expenses by 6% to INR 1,505 Cr in the quarter ended December 2024 from INR 1,597 Cr in the corresponding quarter last year. Sequentially, total expenditure fell 5.5% from INR 1,593 Cr.

Ola Electric’s consolidated EBITDA margin contracted to -40.7% in Q3 FY25 as against -28.4% in the preceding September quarter. The company attributed this to a one-off cost of INR 100 Cr incurred to address service issues and one-time employee-related expenses of INR 13 Cr.

The company expects these costs to normalise from FY26 onwards, led by tech innovation and the newly-launched Gen3 platform.

Cost Of Materials Consumed: The spending under this head declined 29% year-on-year and 19% QoQ to INR 867 Cr in the September-December quarter.

Employee Cost: Ola Electric employee benefits expenses went down 14% to INR 102 Cr during the quarter under review from INr 119 Cr in Q3 FY24. On a QoQ basis, employee costs slid 27% from INR 139 Cr.

Change In Inventories: The company’s change in inventories of finished goods, stock-in-trade and work-in-progress stood at negative INR 56 Cr in the quarter under review, which suggests the company managed to sell fewer escooters than it produced.

Shares of Ola Electric closed Friday’s (February 7) trading session 2.56% lower at INR 70.02 apiece on the BSE. Over the last six months, the stock has tanked almost 19%.

What’s Next For Ola Electric?

In its shareholders’ letter, the electric mobility company said it will rely on three factors to achieve profitability:

• Improvement in gross margin, driven by the newly-launched Gen3 platform, in-house cell and vertical integration
• Optimisation of operating costs while investing in R&D and technology innovation
• Improvement in operating leverage by scaling its S1 portfolio, unlocking the e-bike segment with its Roadster series and expanding into new high-growth categories such as the Gig/Gig+ and the Z range 

“Our in-house 4680 Bharat Cell is on track for commercialisation and Module level testing for integration of these Cells in our vehicles have commenced in Q3 FY25. Our products will start being delivered with our own Bharat Cell starting Q1 FY26,” said Ola Electric.

It must be noted that Ola Electric rolled out its flagship Gen 3 S1 Pro+ scooter earlier this month, which is powered by its in-house 4680 Bharat Cell. The company claims that its in-house cell has a higher energy density, which, in turn, increases the range of these vehicles and reduces costs.

The company said it expects its auto segment to achieve EBITDA breakeven at 50K monthly deliveries, subject to competition and external factors.