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Ola Electric Mobility Limited Q2 FY'25 Earnings Conference Call November 08, 2024 Moderator: L...

Posted: 27 Nov 2024

Ola Electric Mobility Limited Q2 FY'25 Earnings Conference Call November 08, 2024 Moderator: Ladies and gentlemen, good day and welcome to Ola Electric Q2 FY25 Earnings Conference Call. As a reminder, all participants� lines will be in the listen-only mode and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the conference call, please signal an operator by pressing "*" then "0" on a touch tone phone. Please note that this conference is being recorded. I now hand the conference over to Mr. Abhishek Chauhan from Ola Electric Mobility Limited. Thank you and all to you Mr. John. Abhishek Chauhan: Thank you and good evening to everyone and thank you for joining the Earnings Conference Call of Ola Electric Mobility Limited for the 2nd Quarter of Financial Year 2025. To begin with, I would like to request Bhavish Aggarwal � Chairman and Managing Director. Ola and Harish Abichandani � Group CFO of the Company to take us through the Results, but we will take 5 minutes before we start. So, I will give everyone a heads up and then we will start the call. Good evening once again and thank you everyone for your patience. I hope you have gone through the Shareholders Letter now once again to begin with, I would like to request Bhavish Aggarwal � Chairman and Managing Director of Electric, and Harish Abichandani � Group CFO of the company to take you through the Results. Over to Bhavish and Harish. Bhavish Aggarwal: Hi everybody. Good to speak again after a quarter and this is this is Bhavish. This is practically I think our rst quarter in the public markets that we are giving you an update on. Before that actually in the last quarter we had done the IPO and in just three days after that, we had quarterly results. We have also changed our format of how we are updating all of you. We have also changed the way some nancial metrics are being told or more around how industry standards are on revenue, etc. I am assuming most of you would have gone through the Shareholders� Letter that we have tried to capture all the nancials and some operating commentary also in it. What I will do is I will just give you some highlights and my remarks will be very short and then we will get into questions directly. This quarter actually has been a good quarter compared to last year. If you see our revenues have grown about 40% over last year - 38.5%. Deliveries also almost touching 1 lakhs (+98,000) and gross margin, especially for the auto segment is 20.6% which is at quarter-on-quarter whereas year-on-year it's about 12 points up and this is Page 2 of 19 November 08, 2024 despite the much more enhanced competitive dynamics in the industry, which I will talk about in my remarks. The key highlights for us in Q2 have been that we have maintained our market leadership. Our market share is around 33% and this is also a quarter where competitive action got aggressive, and we will comment a bit on that. One key area of focus for us going forward on the market is to expand distribution. We have about 780 odd stores right now. And we are in the process of expanding the company-owned stores to about 2000 by March, which is just about four months away. And in addition, we have also in September launched our Network Partner Program under which third parties like multi-brand outlets, other people who are already in the auto ecosystem from a retail perspective, can also sell our products. We have about 1000 such partners live with our products now. The front-end distribution is a is an important focus. We continue to scale. And as you will nd in the document, for us each store does almost about 130 sales per quarter. And that's almost 2x to 3x of industry average. So, we have much higher productivity per store than the industry and we are expanding our store network so we actually hope that we will be fairly competitive in terms of depth of distribution with about 2000 stores of ours. In addition to that the Network Partner Program will amplify the distribution network. Second, I think more on the industry commentary � for a few quarters there have been questions that how is EV penetration doing? Now actually if you see this quarter and even then after that October last month, we have seen EV penetration start to hit a bit of an inection point, especially if you see the Scooter EV penetration because when you see overall it kind of gets averaged out due to the motorbikes. But when you see Scooter EV penetration in June to September this year itself it's gone from 16% to 21.5%. And even from September last year to September this year, it's gone from 13.5% to 21.5%. A very signicant increase in EV penetration despite the FAME subsidies and all tapering o signicantly. We believe that the EV scooter penetration is actually at an inection point now. And if you also look at it regionally, many states like Rajasthan, UP, Maharashtra, the big states are around between 30% to 45% EV scooter penetration. In fact, Rajasthan is actually 47% so this shows while some states are racing ahead, eventually all states will get here. It's a question of just adding distribution. So, that's a very good encouraging sign in the industry.