Cab aggregator Ola’s leasing arm, Ola Fleet Technologies, has posted a net loss of Rs 13.2 crore for FY16, as compared to a profit of Rs 3.9 crore during FY15, according to a recent filing with the Registrar of Companies.
The net loss comes on the back of the decreased revenue during the year. Ola Fleet’s revenue has fallen by 40% to `9.1 crore during the year, down from the total revenue of `15.2 crore it earned during FY15. Expenses for the leasing company doubled during the year from R11 crore in FY15 to `22 crore in FY16.
Ola had bought Delhi based radio taxi service provider GCabs, owned by Apra Cabs India in January 2015 and renamed it Ola Fleet. While launching its leasing business, Ola had then said that it, along with financing partners and auto companies, will invest `5,000 crore towards this leasing programme over the coming years. The leasing programme addresses two major concerns for Ola. It enables the company to lock in drivers on its platform for a fixed period and reduces the expense on driver incentives.
The loss reported by company comes close on the heels of parent Ola raising $250 million (`1,675 crore) from Japanese telecom and internet major Softbank Corp. In FY15, Ola (ANI Technologies) had posted a net loss of `755 crore and is yet to furnish details of its financial performance for FY16.
The cab leasing business has become more competitive with rival Uber Technologies also making significant investments in its leasing subsidiary, Xchange Leasing India last year. While parent Ola had pumped `50 crore into the leasing subsidiary company recently, Uber put in a total of more than `244 crore in its leasing arm last financial year.
Recently Ola announced a roll out of electric cars on its platform and it is planning to pilot a few thousand electric cars in several Indian cities this year. Ola currently operates in 102 Indian cities and claims to have more than 4.5 lakh vehicles on its platform including cabs, autorickshaws and regular black and yellow label cabs. Though Uber doesn’t disclose its numbers, it is estimated to have 3.5 lakh cabs on its platform.
– Sameer Ranjan Bakshi.