Ola Electric has seen a massive fall in its market share in the last two months, after being one of the top companies in India’s electric two wheeler space. According to a Jefferies report, the investment banking and capital markets firm has said that the market share of Ola Electric declined from 49 per cent in Q1 FY25 to 39 per cent in July and further down to 33 per cent in August month-to-date. This decline comes despite the company’s previous success in capturing a significant portion of the market.
PC: The Economic Times
It said Ola Electric had emerged earlier as the leading OEM in the electric two-wheeler segment. Its market share had risen from 21 percent in FY23 to 35 percent in FY24 and peaked at 49 percent in Q1 FY25. The growth came on the back of product portfolio expansion and aggressive pricing that helped Ola Electric gain an edge over competition.
Though a potential threat from competitors has been envisioned recently, which is totally opposite to increasing its market share. One of the major competitors of Ola Electric is TVS, which is regaining its market share from 15% in Q1 FY25 to 19% in August, MTD. Similarly, Bajaj’s market share increased from 11% in FY24 and 12% in Q1 FY25 to 18% in August MTD. Hero MotoCorp is seen standing at the end with a mere market share of 5 percent while Honda did not enter into this electric segment.
Despite the fall in market share, Ola Electric continues to lead the electric two-wheeler market, followed by TVS, Bajaj Auto, Ather Energy, and Hero MotoCorp. Scooter sales for FY24 were 3,29,618 units, almost double that of the previous year. This was reflected in its revenues, which increased from Rs 2,631 crore in FY23 to Rs 5,010 crore in FY24.
It will see Bhavish Aggarwal-led Ola Electric coming up with affordable electric motorcycles, including the Roadster, which is likely to be ready for delivery by Diwali next year. This is diversification in product offerings and dealing with customer demand.
The shares of Ola Electric have bounced back in the stock market, trading at Rs 128 against the initial public offer price of Rs 76 per share. This is an indication that investors are confident of the long-term growth prospects of the company despite recent market share challenges.
The future path for Ola Electric will not be easy with increasing crowding of the electric two-wheeler market. Increased competition for the company means that staying at the top of the leaderboard is going to become a challenge. Product innovation and strategic expansion have become quite critical in continuing the growth story and tackling the changing market conditions.
