Ola Electric Q2 results: Loss narrows to Rs 495 crore as sales jump

Ola Electric, India's top e-scooter maker by market share, reported a narrower second-quarter loss on Friday helped by a jump in sales, and said the recent surge in service requests was largely for "minor issues."

 

The Bengaluru-based company said its consolidated loss narrowed to Rs 495 crore ($58.7 million) in the July-September quarter from Rs 524 crore a year earlier. 

Ola's quarterly revenue jumped 39.1% to Rs 1,214 crore, helped by sales of mass models, or those priced below Rs 100,000 (about $1,186). It had not begun deliveries of these models last year. 

Ola Electric delivered a total of 98,619 two-wheelers between July and September, 73.6% higher than last year. It sold 56,545 mass models. 

 

Expenses grew by 21.8%, slower than the previous quarter's 26.6% rise. Raw material costs, Ola's biggest expense, rose 46.7% but were lower 18.2% sequentially. 

Rising consumer complaints and regulatory scrutiny over allegations of poor service have cast a shadow on the SoftBank-backed e-scooter maker, following a stellar market debut in August.

 

"Not all service requests that come are complaints or issues with the product, many of them are regular check-ins or scheduled maintenance," founder and chairperson Bhavish Aggarwal said on an analyst call on Friday. 

"Two-thirds of it actually are just minor issues like loose parts or customers unfamiliar with the software used," Aggarwal said.

Ola Electric's shares have fallen 5.5% since listing on Aug. 9, while its dominance in the electric two-wheeler market has diminished in recent months. 

"Over the second quarter, we had a bit of a capacity challenge in terms of service, our sales expanded faster than we had expanded our service network," Aggarwal said. 

Reuters last year visited 35 Ola centres in 10 Indian states and found many faced significant backlogs, with demand outstripping their workforce or their supply of spare parts.