Ola Electric Q2 Revenue Falls 39% to Rs 421 Crore as Analysts Cut Forecasts on Subdued Volumes
Shares of Ola Electric Mobility Limited (NSE: OLAELEC) came under renewed selling pressure after the Bhavish Aggarwal-led electric two-wheeler maker delivered a subdued earnings report for the second quarter, prompting prominent market analysts to slash their forward estimates. The company's top-line contracted significantly amid shrinking delivery volumes and heightened competition from legacy automakers and pure-play electric vehicle (EV) peers.
Key Financial Highlights
Ola Electric's revenue from core operations dropped 39% year-on-year to Rs 421 crore during the July–September quarter, compared to Rs 690 crore in the corresponding period of the previous fiscal year. On a sequential basis, revenue fell 7.5% from Rs 455 crore recorded in the June quarter.
Profitability and Margin Metrics:
- Consolidated Net Loss: Narrowed year-on-year to Rs 362 crore from a loss of Rs 418 crore in the year-ago period, though it widened sequentially from a net loss of Rs 336 crore in Q1.
- Adjusted Operating EBITDA: Stood at a loss of Rs 246 crore, compared to a loss of Rs 258 crore in the year-ago period and an EBITDA loss of Rs 195 crore in the preceding quarter.
- EBITDA Margin: Worsened sequentially to negative 58.5% compared to negative 42.8% in Q1.
- Gross Margin: Stood at 29.93% for the quarter, down from 30.9% in the prior year and 30.5% in the preceding quarter.
On the balance sheet front, total borrowings were reduced to Rs 1,819 crore as of September 2026, down from Rs 3,132 crore in December 2024, aided by capital-raising measures such as rights issues and institutional placements. Automotive segment borrowings dropped to Rs 337 crore from Rs 2,422 crore over the same period.
Brokerages Cut Estimates as Volume Stagnates
The weaker-than-expected operational performance triggered earnings downgrades across institutional brokerages:
- Citigroup: Analysts cut their forward volume growth forecasts by 21% to 22% and reduced revenue estimates by 26% to 42%, highlighting that quarterly deliveries of roughly 35,000 to 36,000 units missed their initial expectations of 44,000 units.
- Goldman Sachs: The brokerage trimmed its multi-year revenue projections by up to 6%, flagging persistent cash burn, supply constraints, and ongoing gross margin pressure exceeding 650 basis points, partially offset by fixed-cost savings.
Following the release, the stock slid over 6% in intraday trade, touching a low of Rs 33.48 on the National Stock Exchange (NSE).
Strategic Shift to Dealership Model Amid Stiff Rivalry
In an effort to turn operations around, Ola Electric has started pivoting away from its pure company-owned store model, transitioning toward a dealer-led retail distribution framework. The company had established 319 dealer stores and is targeting an expansion to 700 partner outlets. Management has set an internal production target of 25,000 units per month, though analysts have characterized the goal as ambitious given ongoing supply constraints.
Meanwhile, market competition has intensified across India's two-wheeler EV landscape. While Ola Electric has experienced market share pressure, rivals such as TVS Motor, Bajaj Auto, and Hero MotoCorp have scaled their EV presence. Competing startup Ather Energy reported a turnaround to a modest net profit of Rs 1.26 crore with revenue rising to Rs 1,526 crore for the same quarter, highlighting the widening performance divergence within India's electric mobility segment.
