Latest news with #OlaElectric
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Business Standard
2 days ago
- Automotive
- Business Standard
EV maker Ola opposes auto firms' plea to reduce duty on traction motors
Electric two-wheeler maker Ola Electric has struck a divergent note with the auto industry, which has appealed to the government to cut the basic Customs duty (BCD) on traction motors by half due to the ongoing export restrictions placed by China on standalone magnets. While the industry has asked the ministry of heavy industries (MHI) to reduce the basic customs duty on traction motors to 7.5 per cent from the current 15 per cent, Ola has opposed the move saying that 'there is no global supply chain crises in electric magnets in the auto sector'. The Bengaluru-based firm has reasoned that it was not in favour of any reduction in duty as this would have an adverse impact on those companies which are making the motors in India, and only importing the rare earth motors (like them). The industry, represented by the Society of Indian Automobile Manufacturers (Siam), has however, said that they have made the request because due to the restrictions on import of standalone magnets (which had a duty of 7.5 per cent) from China, full assembly and sub-assemblies will have to be imported at 15 per cent which would lead to the increase in the cost of the vehicle. The company has argued that it has procured stocks of rare earth magnets from alternative non-Chinese sources in South East Asia and Europe and also plans to introduce 'ferrite motor' powered vehicles by Q3 of 2026, which are as efficient as rare earth powered motors. So they have already worked out an alternate plan of action. In its communication with the MHI, the industry has also sought exemption for traction and wheel rim hub mounted motors which were to be manufactured in the country under the phased manufacturing program for eligibility in the PM e-drive subsidy scheme. That apart, they have also asked for exemption from another condition to get subsidy, that import of PMP components and all other components for electric-2 and 3 wheelers from a single supplier should not be permitted. In the case of PLI, it has requested that additional import costs in sourcing motor assemblies, sub-assemblies, components and electronic throttle will be exempted from the computation of domestic value addition and the import content declared in the techno commercial audit issued before the restrictions by China was imposed will be calculated for DVA has also made it clear that they are not in favour of any change in the domestic value addition norms of PLI as well as the phased manufacturing program as requested by many auto companies. The industry has also pointed out to MHI that while they are committed to the 'Make in India' vision, under the prevailing scenario there is need for the government to provide them with some flexibility to ensure the momentum of growth in EV penetration.
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Business Standard
3 days ago
- Automotive
- Business Standard
Ola Electric, TVS charge up plans to beat rare-earth magnet crunch
Ferrite magnets are now globally considered a viable and cost-effective option due to their easy availability instead of rare-earth materials like neodymium, making it an affordable option Surajeet Das Gupta New Delhi Listen to This Article Ola Electric is planning to launch in the third quarter (September-December) some of its electric vehicles powered with ferrite motors as an alternative to those that go with heavy rare-earth magnets, whose supply the Chinese government has choked. Government sources Ola is in discussion with have said the company has been working for over two years on developing the technology and design for ferrite motors, where the magnet is made of iron (with some other metals added). The prototype has been internally validated and is being tested on some of its vehicles. The company has to go to the Automotive
Mint
4 days ago
- Business
- Mint
From Ola Electric to Vodafone Idea— These 8 Nifty 500 stocks have crashed over 50% from their 52-week highs
The Indian stock market seems caught in a tight range, with most stocks trading below their 52-week highs. Investor sentiment remains cautious amid lacklustre earnings, stretched valuations, and lingering concerns over a potential trade war sparked by US President Donald Trump's tariff-driven policies. Data reveals that 243 stocks in the Nifty 500 index have dropped over 20 per cent from their 52-week highs, with eight of them plunging more than 50 per cent from their one-year peaks. The Nifty 500 index has gained nearly 2 per cent over the last year, in sync with the benchmark Nifty 50, which has also risen by 2 per cent in the same period. The Indian stock market has remained subdued for nearly two months, with the benchmark Nifty 50 moving within a narrow range due to the absence of fresh positive triggers. The index is just 2 per cent up over the last year. Despite earlier expectations of a new high, the Nifty 50 has slipped nearly 3 per cent from its June 30 level of 25,669. This decline puts it further away from its all-time high of 26,277, which was last touched on September 27, 2023. According to Capitalmarket data, Ola Electric, Raymond Lifestyle, Sterling and Wilson Renewable Energy, Tejas Networks, Vodafone Idea, Akums Drugs, HFCL, and Adani Green are the eight stocks that have crashed more than 50 per cent from their 52-week highs as of Friday, July 18, close. On the other hand, Route Mobile, MMTC, Honasa Consumer, Vedant Fashions, UCO Bank, ITI, Titagarh Rail, IOB, Jupiter Wagons, and IREDA were among the 39 stocks that crashed between 40-50 per cent from their one-year highs. Similarly, Ramkrishna Forgings, Deepak Nitrite, REC, MRPL, SJVN, Tata Tech, Inox Wind, Swiggy, IRFC, Just Dial, Trent, Adani Energy, Bajaj Housing, Hindustan Zinc, Bajaj Auto, JSW Energy, Torrent Power, Cochin Shipyard, Exide Industries, Tata Elxsi, Piramal Pharma, Bharat Forge, Adani Total Gas, TCS, and Alok Industries are among the 72 stocks that have plunged 30-40 per cent from their 52-week highs. The medium to long-term outlook of the domestic market remains positive due to a favourable growth-inflation outlook, better-than-expected monsoon, and a strong influx of retail investors. The single most worry for the Indian stock market is the delay in the successful signing of a trade agreement with the US. Otherwise, the domestic economic scenario remains strong- GDP growth above 6 per cent, healthy monsoon, low inflation regime, over 15 per cent decline in crude oil prices from their 52-week highs, and anticipation of continued reversal of interest rate, augur well for the domestic market," said G. Chokkalingam, the founder and the head of research, at Equinomics Research Private Limited. Read all market-related news here Read more stories by Nishant Kumar Disclaimer: This story is for educational purposes only. The views and recommendations expressed are those of individual analysts or broking firms, not Mint. We advise investors to consult with certified experts before making any investment decisions, as market conditions can change rapidly and circumstances may vary.
Mint
16-07-2025
- Automotive
- Mint
Ola Electric's losses widened but the stock rallied. What's going on?
Known for its aggressive expansion, Ola Electric's pivot towards profitability has brought relief to investors. To be sure, revenues halved in the last reported quarter, and losses widened. But management'sintent to shift focus towards profitability, close on the heels of the auto business' first Ebitda-positive month, has kindled hopes of a long-awaited turnaround in the business. After eroding more than half of investors' wealth since listing, the stock rallied almost 20% on Monday. Is this the light at the end of the tunnel for Ola investors, or is it a sucker's rally? Earnings continue to disappoint Founded in 2017, Ola Electric was among the first movers in the electric two-wheeler space. Over the years, it has burnt cash with competitive pricing and aggressive marketing in an attempt to cement its lead. But customer complaints around product quality and after-sales service indicate that in the race for growth, quality may have taken a backseat. The latest quarter's numbers released this week were largely more of the same — falling revenues and widening losses. Compared to the same quarter last year, revenues halved to ₹828 crore and loss widened from ₹347 crore to ₹428 crore. Green shoots spur hope However, revenue increased and losses narrowed compared to the previous quarter. Q1 losses were also smaller than expected, thanks to higher operating leverage on the back of volumes propped up by the previous quarter's backlog. Gen-3 scooters made up 80% of sales during the quarter, and their higher prices supported gross margin. Ola also claims superior product quality was the reason behind the reversal of warranty provisions seen during the quarter. Declining battery prices also helped contain losses. The result? Despite falling short of the previously cited breakeven threshold of 25,000 unit sales a month, the company's auto business turned profitable at the Ebitda level in June. It was also near breakeven on operating cash flows during the quarter. Management indicated that apart from R&D, no large capex was planned for FY26. These green shoots have spurred hopes that aggressive expansion is a thing of the past and that Ola Electric's auto business may have now stepped into its next phase – profitable growth. Profitability over PLI As for Ola's cell manufacturing business, it had signed an MoU to invest Rs.4,500 crore by 2024 towards setting up 20 GWh of capacity to qualify for incentives under the government's production-linked incentive (PLI) scheme. But the company plans to invest only ₹1,000 crore to expand capacity to 5GWh, and focus on profitability thereafter. While industry players including Ola are in discussions with the government, seeking leeway on the PLI targets, Ola has indicated that it will expand cell manufacturing only to the extent that it supports its vehicle sales. It expects the cell business to break even at 3.5-4 GWh by FY27, and does no expect to need more than 5 GWh until FY29. Management has indicated it is unwilling to extend the breakeven timelines just to meet PLI targets, even if this means coughing up penalties of up to ₹100 crore. Competition may continue to play spoilsport While Ola was among the first companies to tap India's electric scooter market, its reputation has suffered some serious damage over the years. Its technological moat has also been eroded by competitors. So, when legacy two-wheeler manufacturers including TVS and Bajaj entered the EV space, Ola's market share slipped sharply from 50% to less than 20% in a year. The only other listed pure-play EV manufacturer, Ather Energy, gained ground during the period. A smaller share of a fast-growing pie would not have been as much of a bother. But the pie has also been growing more slowly. Government initiatives to boost electric two-wheeler sales are gradually being phased out. FAME-II concluded in March 2024, and electric mobility promotion scheme (EMPS) is set on glide path down to just Rs.5,000 worth of subsidies per scooter by 2026. Thus the onus is now increasingly falling on organic adoption of electric two-wheelers. Though electric scooters still constitute only about 7% of all EVs sold in India, sales growth has moderated. This explains the manufacturers' pivots from aggressive market penetration to profitable growth. Ola had to slash 1,000 jobs in FY25 to rein in losses. Ola's deeper issues persist Ola's troubles run deeper than industry headwinds. While the electric two-wheeler segment registered a robust 31.7% growth in June, Ola's sales fell 45%. The company's brand image has been hurt by widespread service issues and customer complaints, which caused the Central Consumer Protection Authority) to step in at one point. Ola responded by resolving a bulk of the pending complaints and investing in doubling its footprint to 4,436 stores. The bulk of these as company owned and company operated, piling on further losses and draining cash. But service issues have apparently persisted. Recently, Ola's flagship electric motorcycle, Roadster X Plus, was in the news as several customers complained about charging issues. The company has also had issues with registration agencies, after which it moved registration in-house. This led to backlogs in registration and invoicing, discrepancies between reported sales and registrations, and delays in deliveries. While the company now claims to have cleared the backlog, it was almost dragged to insolvency over the conflict. This month Ola faced a shutdown of most of its stores in Maharashtra, India's largest electric scooter market. The company is working with the authorities to resolving the issue, which pertains to its store permits and trade certificates. Ola had also seen a string of management exits, further eroding the brand's reputation. Overoptimistic projections? Management has guided for 3.25-3.75 lakh vehicle deliveries and ₹4,200-4,700 crore of revenue during the year. With Q1 revenue at just about ₹800 crore, the guidance optimistically projects average quarterly revenue at ₹1,100-1,300 crore for the rest of the fiscal year. The sharp pickup in revenues assumes strong traction of the company's new launches – one every quarter over the next two years. Management expects gross margin to expand from 26% in Q1 to 35-40%, and has guided for at least 5% Ebitda margin for the full fiscal year. It also expects operating cash flows to turn positive by the end of FY26. A lot seems to be riding on its Gen-3 scooters – higher gross-margins, reduced warranty claims, and PLI benefits kicking in from Q2. Meanwhile, its ongoing efforts at vertical integration towards manufacturing cells and rare-earth-free motors are expected to help control costs, enhance performance, and improve supply-chain resilience. The company is also counting on Project Lakshya to cut costs. While cost savings in Q1FY26 have been attributed to the project, lower battery prices are likely to have also played a role. The proof will be in the pudding. If revenue growth accelerates, margins expand in line with management's guidance, and customer complaints taper off, investors will feel reassured that Ola Electric is walking the talk. For more such analysis, read Profit Pulse. Ananya Roy is founder of Credibull Capital, a SEBI-registered investment adviser. X: @ananyaroycfa Disclosure: The author does not hold shares of the companies discussed. The views expressed are for informational purposes only and should not be considered investment advice. Readers are encouraged to conduct their own research and consult a financial professional before making any investment decisions.
NDTV
16-07-2025
- Automotive
- NDTV
Ola Electric's 90 Per cent Outlets To Be Shut Down In Maharashtra: Report
The state government of Maharashtra has decided to shut down 90 per cent of the showrooms of electric two-wheeler manufacturer Ola Electric, as per Livemint's report. This translates to a closure of 450 stores in the state. The report suggests that the reason behind the closure is the lack of permits for storing vehicles. When implemented, the move tends to disrupt the supply of two-wheeler electric vehicles in one of the largest markets. Maharashtra is one of the biggest consumer states in the country in terms of electric two-wheeler EVs. For the same reason, it is a crucial market for Ola Electric. More than 41,000 of Ola's 344,000 sales across the country came from this state, highlighting its importance to their sales figures and brand visibility. However, the company is encountering difficulties in Maharashtra, as the majority of its showrooms in the area do not possess valid trade certificates, which points to significant issues with operational compliance. Ola's market share has experienced a decrease on a year-over-year basis, declining from 33.4 per cent to 19.6 per cent after the sale of 60,500 EVs in the first quarter of FY26. This decline follows prior regulatory scrutiny due to a gap between reported sales (25,000) and actual registrations (8,500). The company is now contending with heightened competition, as rivals such as TVS and Bajaj have outperformed Ola in June sales, complicating its recovery from operational and legal issues. This comes while the brand has initiated the deliveries of its first electric motorcycle in the country, called the Ola Roadster X. The electric motorcycle was launched in India in February 2025.
