The latest analysis report by Praxis Global Alliance, a management consulting and advisory firm, has suggested that shared mobility in India will resume to pre-COVID-19 levels by the first quarter of FY23. There is a substantial growth in the shared mobility segment owing to the changing ownership patterns of daily commuters. Inherent tailwinds in the market such as the increasing cost of private vehicle ownership, increasing mobile internet penetration and the rise of digital payment options are also boosting the shared mobility market.
Some key implications and takeaways from the study include:
o Increasing vehicle density on roads growing at a CAGR of 6% with 41 vehicles/km in 2016 has made Indian cities among the most congested globally. This is amplified by low usage of public transport i.e. 5% of total trips and 85% of all commute occurring on the road
o Daily commute market grew by CAGR 10% from FY16 to FY20 with the highest growth rates across 2W, 4W taxi, auto segments. The market is expected to be worth US$ 83B in FY22 and recover fully to the pre-COVID (FY20) level by Q1FY23
o Barring 2W taxi, the regulatory framework for other modes of shared mobility is well-defined and with inherent tailwinds in the market makes it possible for shared mobility to be a way of road transportation in the future
o Penetration of online bookings is quite low overall across segments accounting for only 6%, corresponding to about 2% in bus, 100% in cab aggregators, 5% in 3W auto-rickshaw, and 90% in 2W rental and taxi space
o 4W taxi market in India is largely unorganized with the dominance of Maxi cabs and private cabs; popular aggregators like Ola, Uber, and Meru Cabs capture a market share of US$ 3.1B in a US$ 19B market
o 2W rental and taxis are a relatively small market valued at US$ 0.15B in FY19 but has grown rapidly in the last 3 years at 98% CAGR; 70% market constituted by bike taxis with Rapido and Ola holding 40% of the market
o Shared mobility in India attracted a total of US$ 4.4B in private equity funding during 2015-20 with 80% of funding received by cab aggregator companies, followed by 2W taxi and rental startups which received 13% of total investment. In 2020 (YTD till 20th October 2020), the total funding received in shared mobility space is US$ 165M compared to US$ 1.2B funding received in 2019
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