Ola mobility business becomes profitable, eye on industry leadership

 – Gudstory

Ola mobility business becomes profitable, eye on industry leadership – Gudstory

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BENGALURU: Ola on Thursday said it has appointed former Unilever executive Hemant Bakshi as chief executive officer (CEO) for its mobility business, which has turned EBITDA positive in financial year 2023 (FY23) for the first time, as it expands across sectors. Wants to focus on. Which includes ride-hailing and e-commerce services.

A company with positive EBITDA (earnings before interest, taxes, depreciation and amortization) indicates that its core operations are making profits.

Mobility business posted adjusted EBITDA of approx. Compared to losses of Rs 250 crore in FY23 It was Rs 66 crore a year ago, according to a regulatory filing.

“As Ola’s India mobility business turns profitable in FY2023…our focus remains on sustainable growth…it also sets the stage for an exciting future of expansion and industry leadership,” Bakshi said in a statement. The company is now divided into three business segments—Ola Mobility, Ola Financial Services and Ola Logistics—to streamline operations.

The company is looking to enter the e-commerce sector through complete electrification of its fleet. Last year, Ola launched its electric bike taxi in Bengaluru, offering rides 25 more for 5km Rs 50 for 10 km, with plans to expand nationwide. The e-bike service, which is a part of its larger mobility business, started with parcels, food and groceries, and is expected to grow into other additional categories as well. It also hopes to establish a national charging network to support this range.

The government’s emphasis on electrification is also a big advantage for companies like Ola. Last year, Delhi Transport Minister Kailash Gehlot had said that all vehicles would have to be electric after 2030, with an aim to target commercial vehicles to reduce pollution in the capital city.

“Ride-hailing penetration in India is still very low. If we can provide convenience, choice and affordability to our consumers, we can achieve significant growth,” Bakshi said. He said that favorable conditions are also strong for the logistics and online commerce sectors. “We see this space growing to $150 billion by 2025, with most of the growth expected to come from lower SEC consumers in tier-2/3 towns and megacities”.

As part of broader ambitions to increase electrification and mobility, Ola also emphasized opportunities in the e-commerce and logistics sector as it hopes to benefit from a larger customer base, gig-worker platform and other technological capabilities.

Financial services is another area where the company aims to create greater expertise in providing services ranging from payments, lending, asset financing and insurance to its partners and riders.

Meanwhile, the group’s consolidated net loss narrowed to Loss of Rs 772.25 crore in FY23 It stood at Rs 1,522.33 crore a year ago, according to regulatory filings.

Total income, which includes revenue from operations, increased by nearly 48% From Rs 2,481.35 crore in FY23 In the last financial year it was Rs 1,679.54 crore.

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Published: Jan 25, 2024, 10:33 pm IST

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