ICRA Ltd has downgraded the credit rating of Ola Electric Technologies Ltd — a core subsidiary of Ola Electric Mobility — amid a sharp sales decline and prolonged financial stress. The downgrade, from ‘A (Negative)’ to ‘BBB+ (Negative)’, comes after a significant drop in Ola’s electric scooter registrations in April 2025 to 19,709 units, down from over 34,000 a year earlier. ICRA cited slower-than-expected scale-up, sustained cash burn, and an extended path to profitability as key concerns.
Ola Electric, once the dominant player in India’s EV two-wheeler segment with a 52% market share in April 2024, now faces intensified competition from rivals like Bajaj, TVS, and Ather Energy. The ratings agency estimates Ola’s FY25 losses could rise to ₹1,900–2,000 crore, up from ₹1,600 crore in FY24. Operational losses remain steep, with margins at -26.7% in the first nine months of FY25.
Additional concerns stem from regulatory scrutiny following discrepancies in reported sales versus vehicle registrations and complaints about delivery delays. Despite claiming 25,000 February sales, only 8,500 units were registered, due to terminated registration contracts and unfulfilled bookings. With falling revenues and pressure to invest more, Ola’s financial and operational stability is under serious watch.
