Although the company experienced revenue growth, its losses expanded by 8% to INR 1,584 crore from INR 1,472 crore in FY23, according to a national media organization. The firm attributed the increased losses to a surge in expenses.
Ola Electric reported a 90% surge in revenue to INR 5,009 crores for FY24, primarily driven by increased sales of e-scooters, as detailed in the company’s Red Herring Prospectus filed on July 27, 2024.
Despite this significant increase in revenue, the company experienced an 8% growth in losses, expanding to INR 1,584 crore from INR 1,472 crore in FY23. This increase in losses was attributed to rising expenses.
Ola Electric has captured over half of the Indian market share for e-scooters. Nevertheless, the firm’s total expenses for FY24 rose sharply by nearly 62% to INR 6,277 crore. Although the company’s expenses, as a percentage of total income, decreased from 139.55% in FY23 to 119.72% in FY24, Ola Electric noted in its internal risk assessment that it expects to continue incurring operating losses in the short term due to ongoing investments in business expansion.
The company allocated approximately INR 1,600 crore from its upcoming IPO to fund research and development, with about INR 79 crore already spent on R&D in FY24. This accounts for approximately 7.69% of its total revenue. Additionally, employee-related costs, including salaries and bonuses, rose by 3% to INR 438 crore.
In a December 2023 communication to investors and bankers, Ola Electric set a target for EBITDA profitability of INR 803 crore in FY25. The company also forecasted a reduction in EBITDA loss to INR 950 crore for FY24, with anticipated revenue of INR 4,655 crore for the fiscal year.
As it prepares for its IPO, Ola Electric focuses on expansion and making substantial investments in research and development to sustain its competitive edge in the fast-growing e-scooter market.
