Legacy e-scooter companies charge ahead

Ola Electric fell to the third position in India’s electric two-wheeler market in May, losing ground to legacy companies TVS Motor and Bajaj Auto amid a sector-wide sales slowdown. The erstwhile market leader, which has been grappling with operational and regulatory challenges, saw its market share shrink to a fifth from more than half just 13 months ago. The Bhavish Aggarwal-led company had a 20% market share in the first 26 days of May, down from a 22.1% share in April, showed data from the government-run Vahan portal. It recorded 15,221 vehicle registrations during May 1-26, a steep decline of about 60% from 37,388 in the entire May 2024.

In contrast, TVS Motor and Bajaj Auto gained market share this month, accounting for 25% and 22.6%, respectively, despite marginal dips in volume.

Newly listed Ather Energy also posted a drop in market share, down to 13.1% in May from 14.9% in the previous month, with vehicle registrations declining to 9,962 units from 13,287 units during this period.

Falling Short of Targets

Queries sent by ET to Ola Electric remained unanswered till press time.

The company’s latest sales figures fall way short of the targets shared by CEO Aggarwal on the last quarterly earnings call, where he said the auto segment could break even at the earnings before interest, taxes, depreciation and amortisation level with monthly sales of about 50,000 units in the upcoming quarters.

Last week, the company’s board approved raising up to Rs 1,700 crore through non-convertible debentures and other debt instruments — the first fundraising move since its initial public offering (IPO) in August 2024. The funds are expected to bolster operations and shore up finances amid increased regulatory scrutiny and a falling stock price. On Tuesday, Ola Electric Mobility shares closed at Rs 52.49 on the BSE, well below their issue price of Rs 76.

The slide in market share comes as the company has come under the scanner for issues including discrepancies in reported sales data, concerns over vehicle quality and missing trade certificates at several retail outlets.

In February, Vahan data showed 8,652 registrations for Ola Electric, whereas the company claimed in its filings that it had sold 25,000 units. The mismatch was attributed to a temporary backlog during contract renegotiations with registration service providers Rosmerta and Shimnit India.

The discrepancy, however, prompted inquiries by the Ministry of Heavy Industries and the Ministry of Road Transport and Highways.

On May 5, ET reported that intellectual property rights for the Ola brand — currently held under ANI Technologies — are being moved to a new holding entity controlled by Aggarwal’s family office, a move opposed by some ANI shareholders.