Ola Q2FY25: Aggressive Product Expansion with 20 New Models Planned
Company Name: Ola Electric Mobility Ltd | NSE Code: OLAELEC | BSE Code: 544225 | 52 Week high/low: 158 / 72.5 | CMP: INR 72.7 | Mcap: INR 32,076 Cr | P/E- –
Robust deliveries growth (74% YoY) but disappoint 21% QoQ
➡️Ola has maintained to be leader in EV 2W segment with 33% market share during Q2FY25 despite aggressive competitive action. Their mass portfolio report solid growth momentum from 0 deliveries in Q2FY24 to 42,074 deliveries and 15% growth QoQ. While premium deliveries decline 26% YoY (down 45% QoQ) to 42,074. This makes the overall deliveries growth of 74% YoY but decline by 21% QoQ to 98,619 due to degrowth in premium portfolio.
➡️E2W penetration has reached a critical inflection point, increasing from 5.8% in June 2024 to 7.5% by September 2024. In scooters, penetration surged from 16.1% to 21.4% over the same period. Key states like UP, Rajasthan, Karnataka, and Maharashtra show penetration rates between 25% and 45%, indicating robust adoption trends.
Solid growth in topline led by growth in deliveries and increased in EV penetration in India
➡️Ola report robust growth in revenue grew by 39% YoY while on QoQ basis decline 26% to 1,214 Cr due to the degrowth in premium portfolio deliveries. This growth is attributed to increased in E2W penetration to 7.5% in Sep 2024 from 5.8% in June 2024.
➡️Gross profit surged 341% YoY to 225 Cr despite reduction in subsidy over one last year to 20.6%. Gross margin improved 1300 bps YoY to 19% due to BOM cost reduction driven by Gen 2 platform.
➡️EBITDA turn to be negative of (379 Cr) due to higher operating cost but it shrink from negative of (527 Cr) in Q2FY24. This impacted by exceptional cost of warranty around 64 Cr and IPO and one off cost of 36 Cr. EBITDA margin stood at -63% vs -90% in Q2FY24. EBIT stood at -511 Cr vs -527 Cr in Q2FY24 while margin at -42% vs -60% in Q2FY.
➡️PAT growth muted at 6% YoY to -495 Cr offset by higher operating cost, depreciation and interest expense while other income grew 104% YoY to 100 Cr. PAT margin stood at -41% vs -60% in Q2FY24.
| Years | Q2FY25 | Q2FY24 | YoY (%) | Q1FY25 | QoQ (%) | Commentry |
| Revenue | 1,214 | 873 | 39% | 1,644 | -26% | Robust growth on YoY basis but QoQ decline led by degrowth in deliveries |
| COGS | 989 | 822 | 20% | 1341 | -26% | |
| Gross Profit | 225 | 51 | 341% | 303 | -26% | Solid growth in GM driven by reduction in BOM cost |
| Gross Margin % | 19% | 6% | 1300 bps | 18% | 10 bps | |
| Employee cost | 139 | 113 | 23% | 123 | 13% | |
| Other expenses | 465 | 373 | 25% | 385 | 21% | |
| Total OpEx | 604 | 486 | 24% | 508 | 19% | |
| EBITDA | -379 | -435 | 13% | -205 | -85% | EBITDA loss shrink on volume expansion and stable OpEx |
| EBITDA Margin% | -63% | -90% | 2700 bps | -40% | (2200 bps) | |
| Depreciation | 132 | 92 | 43% | 126 | 5% | |
| EBIT | -511 | -527 | 3% | -331 | -54% | EBIT growth muted due to higher depreciation |
| EBIT Margin% | -42% | -60% | 1800 bps | -20% | (2200 bps) | |
| Interest expenses | 84 | 46 | 83% | 67 | 25% | |
| Other income | 100 | 49 | 104% | 74 | 35% | |
| PBT | -495 | -524 | -6% | -324 | 53% | |
| Tax expenses | 0 | 0 | 0 | |||
| Tax Rate% | 0% | 0% | 0% | |||
| PAT | -495 | -524 | 6% | -324 | -53% | Bottom line profit shrink led by higher other income |
| PAT Margin% | -41% | -60% | 1900 bps | -20% | (2100 bps) | |
| EPS | -1.12 | -2.68 | 58% | -1.35 | 17% | |
| No. of Shares | 441.1 | 195.5 | 126% | 239.2 | 84% |
The company is executing a long-term growth strategy focused on product diversification, expanding distribution and service infrastructure, and driving technology innovation with vertical integration for better product differentiation and cost savings.
➡️ Product Expansion: The company currently leads the market with the largest EV scooter portfolio, featuring 6 models priced between ₹75,000 and ₹150,000. To strengthen its position, it plans to enter other two- and three-wheeler segments, with a goal to launch 20 products in the next two years—one new product each quarter. In August 2024, it introduced the Roadster motorcycle series, which will begin deliveries in March 2025, covering a broad price range of ₹74,999 to ₹249,999.
➡️ Distribution and Service Network: The company operates 782 owned stores, each with a sales rate 2-3 times the industry average, and aims to increase this network to 2,000 stores by March 2025. It recently launched a ‘Network Partner Program’ in September to drive EV adoption across India, with over 1,000 partners already enrolled and plans to reach 10,000 by the end of 2025. Service capacity has also been expanded to handle higher volumes, with 80% of requests now serviced within a day.
➡️ Technology Innovation: Through advancements in its Gen 2 and Gen 3 platforms, the company has reduced its BOM cost by 22.5% and aims for further savings of 20% over the next year. Key innovations include new battery structures, a magnet less motor, and single-board electronics, giving the company a significant edge in performance and cost efficiency.
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