IANS | 08 Oct, 2023
Despite gaining significant market shares, Indian electric
two-wheeler (E2W) market leaders like Ola Electric and Ather Energy are
witnessing a lukewarm response from investors amid heavy losses and
regulatory uncertainties, the media reported.
According to Nikkei
Asia, industry executives view the lukewarm response to Ola and Ather's
fundraising “as a warning sign despite the startups' rapid growth” while
green mobility is considered a sunshine sector.
Ather Energy
"resorted to a rights issue after potential investors balked at its ask
of more than $200 million at a valuation of at least $1 billion,” the
report mentioned, citing people aware of the company's plans.
Hero MotoCorp-backed EV company Ather Energy’s losses surged more than 2.5 times in the financial year 2022-23.
The
EV startup reported a loss of Rs 864.5 crore in FY23, against a loss of
Rs 344.1 crore in FY22, according to its annual financial statements
filed with the Registrar of Companies (RoC).
Ather’s total expenses more than tripled to Rs 2,670.6 crore from Rs 757.9 crore in FY22, despite strong sales.
The
surge in losses reported even after the firm’s revenue from operations
grew 4.3 times to reach Rs 1,784 crore during the fiscal year ending
March 2023.
Meanwhile, SoftBank-backed Ola Electric's valuation
rose just 10 per cent to $5.5 billion after a $140 million funding round
led by existing backer Temasek in September, the report mentioned.
IPO-bound
Ola Electric posted a net loss of Rs 784.1 crore in the financial year
FY22, a four times jump from Rs 199.2 crore in FY21.
As per its FY22 results, the total expenditure stood at Rs 1,240.4 crore in the reported fiscal year.
However,
FY22 figures are not comparable with FY21 as the company started
delivering electric scooters from December 2021 only, according to
reports.
According to investors, “while smaller fundraises will
keep them going for now, growth could be impacted if they don't manage
to raise bigger rounds," said the Nikkei Asia report.
While both
startups and legacy automakers saw sales dip, the pressure is far higher
on startups, which need to increase sales as well as reduce losses to
attract investors, the report mentioned.
According to latest BNP
Paribas India EV report, Ola Electric (Ola) continued to lose market
share (month-on-month), dropping to 29 per cent (-66 bps) in September
Bajaj Auto (11.1 per cent, +57 bp) gained the most market share, while
Ola lost the most, followed by Okinawa.
Among the top-five
original equipment manufacturers (OEMs), monthly sales volume rose the
most for Bajaj Auto, while it declined the most for Okinawa, said the
report.
