The company reported 43% increase in net loss at Rs 495 crore in the July-September period, from Rs 347 crore in the previous quarter
Published Date – 22 November 2024, 11:10 AM
New Delhi: Ola Electric, mired in controversies amid a government probe and mounting losses, is set to lay off at least 500 employees as part of an restructuring exercise.
The Bhavish Aggarwal-led electric vehicle (EV) company is trying to boost its operational efficiency by reducing redundancies and ‘drive profitability’, according to multiple reports. The restructuring exercise will impact employees from several departments, the reports added. According to an Inc42 report, citing sources, “the aim is to cut expenses to drive profitability and improve margins. There’s no set time period for the completion of the exercise”.
Ola Electric did not immediately comment on layoffs. The company reported a 43 per cent increase in net loss at Rs 495 crore in the July-September period (Q2 FY25), from Rs 347 crore in the previous quarter (Q1 FY25). The electric two-wheeler company also saw its revenue slump 26.1 per cent to Rs 1,214 crore (on-quarter) from Rs 1,644 crore in the first quarter of this fiscal.
The net loss, however, narrowed on a year-on-year basis. In the post-quarterly earnings call, Aggarwal said the company’s operating expenses had decreased quarter-on-quarter and that the company will focus on cost efficiencies. “As we continue to scale distribution, revenue will keep growing while the operating expenses are likely to remain flat or even decline over the next few quarters,” Aggarwal added.
The company also saw its market share plunge to 33 per cent in Q2, down from 49 per cent in the previous quarter. According to experts, increased competition and service network challenges have impacted Ola Electric’s market dominance. The shares of Ola Electric continue to slide, more than Rs 38,000 crore worth of investors’ money has been eroded in the company’s stock in just a couple of months.
On Friday, the company’s share was hovering around Rs 67 apiece, way below its market debut price of Rs 76 and more than 56 per cent down from its all-time high of Rs 157.40. The market cap had reached an all-time high of around Rs 69,000 crore, which has come down to around Rs 31,000 crore. Several Ola Electric customers have reported problems with software, battery and jammed tyres. The Central Consumer Protection Authority (CCPA) has also ordered a comprehensive probe into the EV company over its consumer complaint redressal practices.
