Ola Electric Mobility Limited has released its Q2 FY27 shareholders’ letter, highlighting a shift in constraint from demand to supply chain ramp-up. The company reported a stable gross margin of 29.9% and a significant reduction in total borrowings to ₹1,819 crore. Key updates include strong dealer momentum for the Auto business and progress in the Cell segment, with plans to scale production and integrate LFP cells into upcoming vehicles.
Ola Electric’s Q2 FY27 Performance and Strategy
Ola Electric Mobility Limited has communicated its Q2 FY27 performance to shareholders, emphasizing a strategic reset and rebuilding of its business model. The company has identified supply chain ramp-up, rather than manufacturing capacity, as the primary constraint for growth. Despite higher commodity costs, the gross margin remained stable at approximately 29.9%. Operating expenses saw a reduction, and the balance sheet has been strengthened through a QIP and rights issue, leading to a significant deleveraging. Total borrowings have decreased from ₹3,132 crore in December 2024 to ₹1,819 crore in September 2026.
Automotive Business Momentum
The Auto business is experiencing strong momentum, with 255 dealer partners operating over 300 stores by November 8th. Wholesales are ramping up, and dealers are reordering, indicating a strengthening flywheel effect. The constraint here is also the supply chain’s ramp-up. Automotive borrowings have been substantially reduced to ₹337 crore. The company is introducing the S1Z in Q4 FY27 at a lower price point with an LFP cell and plans to integrate LFP cells into existing products to reduce bill of materials cost. Industry volumes for E2W (Electric Two-Wheeler) grew by 82.7% year-on-year in Q2 FY27, with EV penetration reaching 11.2%.
Cell Business Expansion
In the Cell segment, Ola Electric achieved its 6 GWh cell capacity target ahead of schedule, and production is ramping up. The Government has extended the ACC PLI to CY2031, with incentives expected from the next quarter. The company highlights its unique position as the only Indian company with commercialized cell manufacturing and technology. The Gigafactory is commissioned, with initial focus on meeting automotive requirements, comprising roughly 30% NMC and 70% LFP. The company expects to consume about 2-3 GWh in FY28 for its auto business. NMC yields are projected to reach 80-85% by the end of Q3 FY27 and 90% in Q4 FY27, while LFP production will begin this quarter, targeting 70% yield by the end of Q4 FY27.
Financial Highlights
Key financial metrics for Q2 FY27 show revenue from operations at ₹421 crore and gross margin at ₹126 crore. Operating expenses were ₹369 crore. The company’s financial reports indicate a continued focus on cost reduction and improving operational efficiency across both its Auto and Cell segments. The integration of LFP cells is expected to provide cost savings, breaking even with buying cells from outside at a 70% yield and offering savings of 10-15% at 85% yield.
Source: BSE
