While revenue and deliveries fall sharply, Ola Electric shifts focus to profitability, cost efficiency, and energy storage expansion.
Q2 Snapshot: Loss Narrows Despite Revenue Decline
Ola Electric reported a 15% year-on-year reduction in consolidated net loss to INR 418 Cr in Q2 FY26, compared to INR 495 Cr in the same period last year. Sequentially, the loss also shrank slightly by 2.3% from INR 428 Cr.
However, this improvement came alongside a steep 43% YoY drop in revenue from operations, which stood at INR 690 Cr, down from INR 1,214 Cr in Q2 FY25. The revenue also declined 16.7% sequentially from INR 828 Cr in Q1 FY26.
Auto Segment Turns EBITDA Positive Amid Volume Pressure
Ola Electric’s automotive segment turned EBITDA positive for the first time, posting a profit of INR 2 Cr compared to a loss of INR 162 Cr last year. The company’s overall EBITDA loss halved to INR 137 Cr, down from INR 279 Cr in Q2 FY25.
- Gross margin for the auto segment rose to 30.7%, up from 18.5% a year ago and 25.6% in Q1.
- Operating expenses (auto opex) were trimmed to INR 258 Cr from INR 308 Cr in the prior quarter.
Despite these gains, vehicle deliveries dropped 47% YoY to 52,666 units and declined 23% sequentially. The revenue from the automotive business was INR 688 Cr, down 43.3% YoY.
Strategic Pivot: Profit Focus Over Market Share
Ola Electric emphasized a strategic shift towards margin-driven growth rather than aggressive market capture. In a hyper-competitive EV market, the company is avoiding short-term discounting wars in favor of cost optimization and product reliability.
“We are focusing on improving cost structure, deepening product quality, and driving margin expansion,” the company noted.
The popular Roadster ebike saw notable traction, with sales quadrupling from Q1 levels and peaking at 450 units in a day during the festive period. It now accounts for about 15% of total sales.
HyperService: Untapped Margin Potential
Ola’s HyperService vehicle service business is being repositioned as an open platform for EV parts and services. Currently, auto parts contribute just 2.5% to Ola’s revenue, compared to the industry average of 10–15%.
- The company plans to scale this through direct distribution via app and website, expecting gross margins above 50%.
- Ola anticipates improved margins and customer retention through this route in the coming months.
Battery Cell Expansion & Foray Into Energy Storage
Ola Electric’s cell manufacturing business—which makes lithium-ion 4680 Bharat cells—recorded INR 4 Cr revenue, up from INR 1 Cr a year ago. However, its loss surged 61% YoY to INR 79 Cr due to ongoing investments.
- The company is now integrating in-house battery cells into its vehicles, targeting full integration within 6–9 months.
- This move is expected to create a baseline demand of 2–3 GWh annually for its cell segment.
In a strategic pivot, Ola Electric announced its entry into the commercial energy storage space with the Ola Shakti line.
- Target customers include industrial, utility, and commercial users, with storage systems ranging from 100 kWh to 5 MWh.
- Ola plans to scale Shakti revenue to INR 100 Cr by Q4 FY26, and INR 1,000–2,000 Cr annually by FY27.
The company now projects a cell capacity of 5.9 GWh by March 2026, and 20 GWh by H1 FY27, a stark contrast from its previous conservative forecast of 5 GWh by FY29.
Outlook: Disciplined Growth in a Flat Market
Despite macro headwinds and declining volumes, Ola Electric is focused on profitable expansion, both in its core EV segment and new energy ventures.
- It has revised its earlier FY26 vehicle sales guidance due to prioritizing margin and cash flow over volume.
- The company is banking on battery integration and energy storage systems to drive the next phase of growth.
Ola Electric narrowed Q2 FY26 losses and turned its auto segment EBITDA positive, despite a 43% revenue drop. With intensified competition, it’s prioritizing profitability and efficiency. The company is also entering energy storage with ambitious growth plans for its battery cell and Ola Shakti offerings.
