HOP Electric to establish 60-acre EV park in Neemrana: CEO Mehta

Company will raise money for the project by taking debt and through equity sale, he says

HOP Electric Mobility, an electric two-wheeler manufacturer, is acquiring 60-acre land at Neemrana in Rajasthan to establish an electric vehicle (EV) park with production capacity of 5 lakh units per annum, said its co-founder and CEO Ketan Mehta on Monday.

“The total investment, once it is fully occupied and operational, by us as well as our component suppliers and partners will go up to about Rs 1,000 crore cumulatively,” he told 'Business Standard' in an interview.

This investment would be done over a period of 3-4 years, he said.

Asked about HOP's share in this investment, he said the figure is not available right now as the discussions over design and layout of the park are ongoing.

HOP—selected by the Central government in February under its production-linked incentive (PLI) scheme—will raise money for the Neemrana park by taking debt and through equity sale, he said.

The company will be setting up its manufacturing facility in phases within the EV park. “Overall capacity of our facility in the park, when complete, will be 5 lakh units per annum,” Mehta said.

HOP will lease out plots within the park to component manufacturers to establish their factories there, he said, adding that these plants will be supplying parts exclusively to the two-wheeler maker.

The acquisition of 60-acre land is in advanced stages and it should be completed by January 2023, he mentioned.

The company launched its electric bike named Oxo on Monday at a price starting from Rs 1.25 lakh (ex-showroom). It has a top speed of 90 km per hour. If driven at a speed of about 45 km per hour, the e-bike can travel 150 km distance on a single charge.

Mehta said the company has received about 5,000 bookings for Oxo even before its launch.

HOP expects to begin dispatches of Oxo to customers from September 30 and targets to sell 50,000-60,000 Oxo e-bikes by the end of 2023, he mentioned.

HOP already has a facility in Jaipur, Rajasthan, where it can manufacture up to 1.2 lakh vehicles per annum. Earlier this year, HOP received USD 2.6 million from a publicly listed strategic investor, as part of an ongoing USD 10 million pre-series fundraiser.

The first phase of the company’s facility in Neemrana is expected to go live by the end of 2023, he mentioned.

Neemrana is located strategically where both connectivity by road or rail is within 10-20 km distance, he explained.

“Neemrana is quite close to the automotive hub in the Japanese zone and Manesar. There is a freight terminal at 10 km distance. There is a DFCC (Dedicated Freight Corridor Corporation) railway station at 20 km distance. The national highway is at 10 km distance,” he stated.

A total of 240,662 units of electric two-wheelers were sold in the country during the first half of 2022, contributing to 3.6 per cent of total two-wheeler sales, as per data of Federation of Automobile Dealers Associations (FADA).

In entire 2021, only 143,261 units of electric-two wheelers were sold in India, contributing to 1.16 per cent of the total two-wheeler sales.

HOP Electric had in July 2021 launched two low-speed scooters: Leo and Lyf. “We have sold close to 10,000 scooters (Leo and Lyf) till date. Both the scooters are being manufactured at Jaipur facility,” Mehta noted.

Leo and Lyf are low speed products with a top speed of about 25 km per hour.

“We will be upgrading Leo and Lyf to high-speed products (with a top speed of about 65 km per hour) within this year itself. It is already in approval process. The testing is done,” Mehta stated.

Cumulatively, the company expects to sell about 1 lakh units (Oxo plus upgraded Leo plus upgraded Lyf) by the end of 2023, he added.

On top of the internal testing that the company did for Oxo, it also wanted feedback from the prospective customers, Mehta said.

The company shipped out 40 hand-built prototypes of its motorcycle to 40 dealers across India for testing, he said. More than 500 consumers drove these bikes for total 75,000 km last month during the external testing phase, he mentioned.

The idea was to test the motorcycle in different terrains such as hilly areas, in hot western states, rainy areas. The company has approximately 140 dealership stores in around 12 states across the country. “The company is adding 10 stores per month. We are not going pan-India right now. The idea is to consolidate our position during the next year.”

However, the company is seeing the demand for its products from across the country – from tier 1 to tier 3 cities, he stated.

He said the company will be establishing energy pumps at its dealership stores.

“The pilot for energy pumps is being conducted in Jaipur…We want to populate one city so much that you will find a e-pump at every 2 km distance. And then we will be moving to another city. Their expansion will be gradual,” Mehta said.