Ola Electric (544225) Nov 2025 Filing Analysis

Expect the EV industry to resume growth in FY27, in the approximate range of 15%–30% annually. — target: Industry growth expected in the 15%–30% range

Launch ADAS and in-house ABS with MoveOS 6. — target: ADAS and in-house ABS launch

The technology moat strengthened from internal R&D capability toward real-world deployment. Ola reported that Gen 3 products had roughly half the defect rates of previous generations, while its 4680 cell platform was being introduced gradually into vehicles and Shakti. The later baseline continued to classify the IP and technology moat as moderate, with own-cell revenue still only 1% of total revenue. Thus, the moat expanded operationally but remained moderate in commercial strength. (4 expanding)

Automotive profitability improved sharply. Gross margin rose from 13.8% in Q4 FY25 to 30.7% in Q2 FY26, a 16.9 percentage-point improvement, or 122.5% relative growth. Management attributed this to cost control, better product economics and limited dependence on production-linked incentives. (5 expanding)

Motorcycles were a new, expanding product stream in Q2 FY26, reaching 12%–15% of quarterly Auto volume. The baseline later described a growing Roadster motorcycle range but did not provide a newer percentage mix. The segment had therefore clearly expanded from launch into a material contribution, though its later share cannot be quantified from the available baseline. (3 expanding, 1 contracting, 1 new)

The mix shifted toward higher-value non-vehicle revenue. MoveOS+ software subscriptions and accessories lifted Auto average selling price from Rs. 121,000 to Rs. 131,000, an increase of approximately 8.3%. Parts were still a small stream in Q2 FY26 but management targeted 5%–6% of revenue within a few quarters, with 50%–60% gross margins. The later baseline did not provide a separate parts or software share, so the material shift is the move toward recurring and aftermarket monetisation rather than a quantified later share. (1 shifted, 1 expanding)

Auto two-wheeler ASP increased from Rs. 121,000 to Rs. 131,000 in the latest quarter, supported by higher software and accessory attachment, higher-priced 4680 products, Pro Plus products and motorcycle mix. This is a positive mix-led increase, but only two ASP data points are available in the document, so the trend is best classified as a new positive trend rather than a proven multi-quarter acceleration. (1 new trend across 1 signal)

The installed customer base exceeds one million vehicles, but the document does not provide quarterly service-revenue data or a multi-quarter revenue trajectory. HyperService is newly launched and aims to expand parts and service income. The opportunity is material, but this is a new trend rather than an established quarterly growth trend. (2 new trend across 2 signals)

Motorcycles are a newly established growth avenue. They represented approximately 12%–15% of Ola's total volume in Q2 FY26, rising from Q1, while management describes increasing customer interest and traction. The rollout remains deliberately gradual, so the signal is positive but still early-stage rather than proven acceleration over several quarters. (3 new trend, 1 accelerating across 4 signals)

The margin risk eased materially during the reported quarters, but remained high because profitability was still thin and partly dependent on execution. Auto gross margin improved from 13.8% in Q4 FY25 to 25.6% in Q1 FY26 and 30.7% in Q2 FY26. Gross-margin contribution from PLI was only about 2% in Q2 FY26, according to management, reducing immediate subsidy dependence. However, Auto operating EBITDA remained negative ₹47 crore and the company acknowledged aggressive competitor discounting. The later baseline reports a sharp gross-margin reversal, confirming that this risk was not structurally eliminated. (1 easing, 3 intensifying)

In Q2 FY26, PLI contributed only about two percentage points to the 30.7% gross margin because certification was received late. Management expected a further 5-6 percentage-point benefit once the portfolio was fully covered. The later baseline confirms that the business remained materially dependent on PLI, with gross margin of 30.5% including the benefit versus 23.3% without it. The risk intensified because the measured dependence became clearer. (5 intensifying)