Ola Electric Said to Have Recorded $136 Million Loss in FY 2022-23, Missing Revenue Goal

India’s largest e-scooter maker Ola Electric recorded an operating loss of $136 million (roughly Rs. 1,118 crore) on a revenue of $335 million (roughly Rs. 2,754 crore) in the last financial year which concluded in March, three sources told Reuters, missing its publicly disclosed revenue goal.

The 2022-23 loss number of SoftBank-backed Ola Electric, which is preparing for an up to $700 million (roughly Rs. 5754 crore) IPO, has not previously been reported or filed with Indian authorities, which allows time until September to file previous year’s earnings.

Ola declined to comment.

The e-scooter maker last year in June issued a statement saying it was “on track to surpass $1 billion (roughly Rs. 8,220 crore) run rate by end of this year” and “the future forecast looks even stronger.”

The run rate is a financial indicator calculated by taking one month of Ola’s revenues and multiplying by 12.

But that revenue projection for 2022-23 was missed. Two sources with direct knowledge of its financials said Ola’s first full year of operations saw it record a revenue of $335 million in year with over 150,000 unit sales, and an operating loss of $136 million.

Ola sold about 21,400 electric scooters in March – the last month of the fiscal year 2022/23.

Since it began sales in late 2021, Ola has become India’s e-scooter market leader with a 32 percent share, competing with Ather Energy as well as companies like TVS Motor and Hero Electric. It was valued at $5 billion (roughly Rs. 41,104 crore) last year and has raised nearly $800 million (roughly Rs. 6,576 crore) from investors since 2019.

Ola Electric earlier this year laid out aggressive projections internally, estimating its revenue will quadruple to $1.5 billion (roughly Rs. 12,331 crore) 2023-24, a year when it also plans to clock its first profit, Reuters reported last week.

But this was before India slashed government incentives in May on e-scooters, which analysts say will force Ola and others to redraw growth plans.

Despite the incentives cut, the company remains confident it can this year become operationally profitable – a key metric watched by potential IPO investors, according to one of the sources.

“Ola is a market leader in a short while … That’s what their existing investors are bullish on,” the person added.

Ola says it builds its e-scooters in the southern state of Tamil Nadu from “the world’s largest 2 wheeler factory” which has capacity to produce 10 million units a year. The company has been spending hundreds of millions of dollars in expand its factory and service centres.

© Thomson Reuters 2023