Ola Electric might’ve had a bumper listing at the stock markets, but even as the company has gone public, its market leadership appears to be slipping.
Ola Electric’s market share in the electric two-wheeler space has fallen from 49 percent in the March-June quarter to just 33 percent in August 2024, a Jeffries report has said. Ola Electric had gone public on 9th August, and its stock touched a high of Rs. 157 on 20th August, representing a near-100-percent gain in 11 days.
As per the Jeffries report, Ola Electric had a market share of 21 percent in FY23, which rose to 35 percent in FY24. In the fourth quarter of FY24, it had risen to 39 percent, and rose further to 49 percent in the first quarter of FY25. But since that peak, Ola’s market share has slipped, and was 39 percent in July 2024, and just 33 percent in August 2024.
The biggest beneficiary of Ola’s lowered market share appeared to be 2-wheeler giant TVS, which saw its market share grow from 15 percent in Q1FY25 to 18 percent in July 2024, and to 19 percent in August 2024. Bajaj also grew from 12 percent in Q1FY25 to 16 percent in July 2024 and 18 percent in August 2024.
The rise of the two-wheeler incumbents will likely worry Ola, which had burst into the electric 2W space, and caught companies like Bajaj and TVS napping. These companies had been initially dismissive of its initial success, with Bajaj Chairman Rajeev Bajaj saying that they’d eat newer entrants for breakfast. But Ola had managed to more than hold its own against these giant companies, and ended up with nearly 50-percent market share in the electric 2W space.
But as recent data shows, holding on to this market share might be harder for Ola than it was to get there. In the last few quarters, Bajaj and TVS have gotten their acts together, and come up with competitive electric variants of their own. Also, they already have the distribution heft they’ve created over several decades, and can use it to turbo-charge their growth in the electric two-wheeler space. And additionally, some of Ola’s growth wasn’t entirely organic — between April 2022 and December 2023, Ola’s ride hailing arm had purchased 12,000 Ola Electric scooters from Ola Electric, and these one-off purchases might not repeat going forward. As things stand, Ola Electric still remains the market leader in India’s electric 2W space, but the industry’s incumbents are slowly waking up — and beginning to make their presence felt.