1. Opening Hook
If EVs had a caffeine equivalent, this quarter’s call was it. Bhavish Aggarwal, as always, opened with calm bravado:“We have 30.7% gross margins — better than many ICE companies.”The founder who once raced cabs is now racing cost curves. Between 4680 cells, battery ambitions, and newOla Shaktihome batteries, Ola isn’t just chasing vehicles anymore — it’s chasing energy dominance.Still, one thing remains stubbornly unchanged — Bhavish’s tone oscillates between visionary and defensive. Read on for the blend: 70% ambition, 30% operational chaos, and one big question — can Ola finally convert tech swagger into sustainable scale?
2. At a Glance
| Metric | Q2 FY26 | QoQ / YoY | Key Takeaway |
|---|---|---|---|
| Gross Margin | 30.7% | ↑ | Now comparable to ICE OEMs; 2% from PLI |
| Operating Cashflow | ₹15 Cr | +ve | Auto business turns cash-generative |
| Gigafactory Output | 2.5 GWh (→5.9 by Mar’26) | New | Ramp begins |
| BESS “Ola Shakti” Launch | Oct’25 | New biz | India’s 1st residential battery storage product |
| BESS ASP | ₹50,000–₹2,00,000 (avg ₹1.25–1.5L) | – | To hit ₹1,000 Cr revenue in FY27 |
| PLI Impact | 2% margin now → 7–8% by Q4 | – | Full portfolio eligible from Jan’26 |
| Auto Delivery Guidance (H2) | 1,00,000 units | – | Consolidation mode |
| EBITDA Breakeven Volume | 20,000/month | ↓ from 25k | Achieved in Q2 |
| Market Share Goal | 25% long-term | Flat near term | Strategic pause |
| Gross Margin Target (Q4FY26) | 36–37% | +5–6 points | PLI + cost control |
3. Management’s Key Commentary
“30.7% gross margin, better than many ICE companies.”(Translation: EVs are finally making money — at least on PowerPoint.)
“Auto business is now cash-generative.”(Translation: Ola finally stopped burning money faster than its scooters charge.)
“We launched Ola Shakti — a home energy storage product built with our own 4680 cells.”(Translation: From scooters to sockets, we now sell everything that stores charge.)⚡
“₹1,000 crore BESS revenue by FY27.”(Translation: The inverter market just got an upgrade — and a Bhavish.)
“PLI will add 7–8 gross margin points by Q4.”(Translation: The government subsidy is the new angel investor.)
“We don’t mind short-term market share loss — others are buying share; we’re buying sustainability.”(Translation: We’re losing sales, but let’s call it discipline.)😏
“No more capex in Auto — all investments already behind us.”(Translation: The wallet’s closed until the stock re-rates.)
4. The Numbers Behind the Noise
Ola is executing a rare pivot — from blitz-scaling to balance-sheet sanity.
- Revenue Mix:Scooters 85%, Motorcycles 10–15%, BESS 0% (to start in Q4).
- ASP Jump:₹1.21L → ₹1.31L, driven by Gen3, accessories, MoveOS+ subscriptions.
- PLI:Minimal in Q2, full benefit from Jan’26 (adds ~7–8 points to margins).
- Employee Cost:Down from ₹450 Cr → ₹416 Cr — Bhavish calls it “sustainable optimization.”
- Breakeven:Auto EBITDA positive at 52,000 deliveries; breakeven ~20,000/month.
- Parts & Service:New profit center; expected to add 2–3 points to margins by FY27.
- Cashflow:Positive from Auto; consolidated OpEx trending down each quarter.
TL;DR:Ola’s now acting like an OEM, not a startup.
5. Analyst Questions – Highlights
Goldman Sachs:🔹BESS revenue assumptions?— FY27 ₹1,000 Cr; ~60,000–70,000 units @ ₹1.25–1.5L ASP. Strong response from pre-orders.
🔹Auto ASP jump reason?— Higher software subscriptions & accessories, Gen3 pricing mix, motorcycles’ higher ticket size.
Bank of America:🔹Gen3 transition & PLI status?— Fully Gen3 by Q3; full PLI by Jan–Feb’26. Adds ~7–8 margin points.
🔹Warranty costs and service issues?— Improving with Gen3; defect rates down 50%. Ownership experience “work in progress.”
🔹Cell cost parity?— Reached at 3–5 GWh scale; ramping fast; first 4680-powered vehicles already delivered.
Citibank:🔹Market share vs profitability trade-off?— Industry consolidation phase; short-term share loss acceptable.— Target: 25% share, top 2 players long-term.
🔹Employee cost dip sustainable?— Yes. “High earlier for growth, now lean for profits.”
TPG / Invesco:🔹ROE timeline?— “Couple of quarters,” once operating leverage kicks in.— Long-term EV ROEs to exceed ICE
