As Indian cab aggregator Ola expands its presence across geographies, the company has started making profits on its every ride after taking into account expenses such as driver incentives and customer discounts in the home ground. With this positive inclination, the company expects to be profitable in 2018.
In an email to employees, Ola CEO Bhavish Aggarwal wrote: “Last week, our India business crossed a major milestone. We are now ENTR positive.”
ENTR, described as “effective net take rate” is an important metric for ride-hailing companies. Take rate is the commission charged by companies from their drivers and ENTR is the take rate after removing costs such as discounts per ride.
“This milestone has come after a consistent and persistent effort that all of you contributed in, and we’ve been able to achieve it keeping market share and growth steady,” Aggarwal added.
He also emphasised that the company has not sacrificed top-line growth or ceded market share to Uber to achieve this goal.
Aggarwal wrote in the email that Ola is aiming to become profitable this year. “We will continue to focus on profitable and sustainable growth, and building a growing profitable business, the first in Indian internet,” he added.