EV stock of Bhavish Aggarwal falls to a 52-week low after…

Ola Electric Mobility’s stock faced a sharp decline of over 7 per cent, reacting to a challenging set of Q3 results that highlighted a significant slump in top-line performance. The company’s revenue from operations plummeted to Rs 470 crore, marking a 55.02 per cent year-over-year drop from Rs 1,045 crore. This downturn was primarily driven by a steep 61 per cent decline in sales volume, with scooter deliveries falling to 32,680 units compared to 84,029 units in the same period last year. Sequentially, the revenue also saw a 32 per cent dip from the September quarter, reflecting a period of intense transition and market headwinds.

Despite the shrinking revenue, the Bengaluru-based EV maker reported a narrowing of its consolidated net loss to Rs 487 crore, down from Rs 564 crore in the previous year. However, this loss widened when compared to the Rs 418 crore reported in the preceding September quarter. The company’s EBITDA margin losses also expanded significantly to -58 per cent, a sharp increase from the -29 per cent recorded in Q2. Management described the quarter as a "structural reset," aimed at realigning the retail footprint and cost structure to navigate slower EV penetration and the urgent need for better service execution.

A notable silver lining in the report was the record consolidated gross margin, which climbed to 34.3 per cent. This represents a substantial improvement of 15.7 percentage points year-over-year, bolstered by the economics of the Gen 3 platform and PLI accruals. By deepening vertical integration and streamlining operations through AI-led automation, Ola Electric aims to lower its quarterly operating expenses to a range of Rs 250–300 crore. This shift is intended to bring the EBITDA breakeven point down to approximately 15,000 units per month, creating a leaner model for future scalability.

On the operational front, the company achieved several technical milestones despite the financial turbulence. Cell production doubled quarter-on-quarter to 72,418 units and the firm successfully executed the first commercial deployment of its in-house 4680 Bharat Cells. Additionally, the launch of Ola Shakti, a residential Battery Energy Storage System (BESS), signals an expansion into the broader energy storage market. The Gigafactory is currently operating at 2.5 GWh of capacity, with plans to scale up to 6 GWh by March 2026 to support both EV and grid-scale energy demands.

While the market reacted negatively to the immediate volume and revenue contraction, the company remains focused on its long-term path to profitability. The spokesperson emphasized that with service metrics stabilizing and manufacturing reaching commercial-scale deployment, the firm is positioned for improved operating leverage. As demand recovers, the new operating model is expected to support a three-to-fourfold increase in volume with minimal incremental costs. For now, investors remain cautious as they weigh the benefits of improved gross margins against the stark decline in current market share and sales.

Disclaimer: The article is for informational purposes only and not investment advice.