The Indian electric bus market is still in its early stages, but it is expanding quickly. In 2026, as per Mordor Intelligence, the market is estimated at around USD 1.41 billion and is expected to grow to USD 2.4–2.9 billion by 2030, at a CAGR of about 14-20%.
According to earlier data, India had over 9,700 electric buses deployed by 2024, with growth momentum exceeding a 60% CAGR in the initial years. In FY26, electric buses currently account for around 4.5% of total bus sales.
Globally, the electric bus market is much larger. It was valued at USD 32–62 billion between 2024 and 2025 and is expected to cross USD 200 billion by 2035, growing at a CAGR of 12–18%. China dominates the market, but India, Europe, and Latin America are emerging as key growth regions.
Key Players Driving India’s Electric Bus Growth
Olectra Greentech: The BYD Partner Guarding its Lead
Established in 2000, Olectra Greentech, part of the MEIL Group, operates in two business segments: electric buses and polymer insulators. The e-bus product lineup includes V2, IX, X2, and CX2. The company is also recognised as the manufacturer of India’s first electric tipper under the name Meghaetron.
On the other hand, its insulator solutions include injection moulding, crimping, and storage. Talking about the client list, in the e-bus segment, some notable names include:
- Telangana State Road Transport Corporation (TGSRTC)
- BEST (Brihanmumbai Electric Supply and Transport)
- PMPML (Pune Mahanagar Parivahan Mahamandal Ltd)
- Surat Municipal Corporation
- Uttarakhand Transport Corporation (Dehradun)
- Silvassa Transport Department
- Nagpur Municipal Corporation
Whereas, in the insulator division, the customer list comprises:
- Power Grid Corporation of India Limited
- Larsen & Toubro Limited
- Kalpataru Power Transmission Limited
Olectra Greentech has also entered into a strategic partnership with BYD, the Chinese EV major that now rivals Tesla. In 2024, the company successfully extended the co-operation agreement with BYD until 2030.
Let’s move to the progress the company made in FY26.
A month ago, Olectra bagged orders worth ₹1,800 crore from Telangana State Road Transport Corporation for the supply, maintenance, and operation of 1,085 electric buses. The deal includes 12 AC buses of 60-metre length and 1,025 non-AC buses of 12-metre length. The delivery of these buses will take place over a span of 20 months.
To boost its manufacturing capacity, in December, Olectra Greentech commenced operations at its Seetharampur facility in Telangana. In Phase 1, the plant has a manufacturing capacity of 2,500 electric buses, which represents 50% of the total planned capacity.
In FY26, under the outright purchase model, the company also received an order of 297 non-AC e-buses worth ₹497 crore from the Himachal Road Transport Corporation (HRTC).
Financial forensic: Why Olectra’s profits are under pressure
Turning to the financials, Olectra reported a consolidated revenue of ₹664 crore in the December quarter of FY26. Sequentially, the revenue is up by ₹8 crore, and on a year-on-year basis, it surged by ₹115 crore.
Segment-wise, e-vehicle contributed ₹574 crore of the total sales, while ₹89.6 crore came from the insulator division. The sales volume of the e-vehicle segment fell by 1.2% on a quarterly basis, while on a yearly basis, it rose by 22.9%.
Consolidated net profit saw a dip. In Q3 FY26, it stood at ₹47 crore, similar to what it reported a year ago, while on a quarter-on-quarter basis, it is down by ₹2 crore. Excluding taxes and interest, the e-vehicle division saw a dip of 3.3% sequentially.
The muted performance in net profit is attributed not only to sales volume but also to structural margin pressures, such as higher input costs of batteries and components, execution costs on large bus orders, and scaling costs related to manufacturing and logistics.
Olectra Greentech Limited 5-Year Financial Performance
| Particulars | FY21 | FY22 | FY23 | FY24 | FY25 |
| Sales (₹ in crores) | 281 | 593 | 1,091 | 1,154 | 1,802 |
| Operating Profit (₹ in crores) | 20 | 85 | 141 | 166 | 262 |
| Net Profit (₹ in crores) | 8 | 35 | 67 | 79 | 139 |
| EPS (₹) | 0.9 | 4.3 | 7.9 | 9.4 | 16.9 |
Despite global turmoil, Olectra Greentech shares surged by over 30% in the span of a month. Over six months, the shares fell by more than 22%, but on a year-to-date basis, they have surged by over 7%.
In terms of shareholding, foreign institutional investors reduced their holdings by 0.14% to 6.9% in the December quarter. Domestic institutional investors raised their stake by 0.13% to 0.82%.
Ashok Leyland Ltd.
Part of the Hinduja Group, Ashok Leyland is considered the second-largest manufacturer of commercial vehicles in India. The company offers end-to-end solutions for trucks, buses, light vehicles, and defence-related vehicles, such as armoured (LBPV 4×4, ATT 4×4, MBPV 4×4), high mobility (HMV 12×12), specialist (27kL U4019, TFF 4×2, U4019), and logistics (Stallion 4×4 MK IV, Guru 4×4, and BAGH 4×4).
The company also offers power solutions. In this segment, its product lineup includes CPCB4+ diesel gensets, marine genset engines, and a few more.
Switching Gears: How Ashok Leyland is Outperforming Peers
Ashok Leyland entered the electric mobility space in 2022 through its subsidiaries, Switch Mobility and OHM Global Mobility. Since then, it has scaled up rapidly. To date, Switch Mobility has deployed over 2,000 electric buses and 1,600 light commercial electric vehicles globally.
In FY26, Switch Mobility sold 1,466 electric buses and outperformed Tata Motors and Olectra Greentech. The company has also captured 24.8% market share in the e-bus segment.
A mix of factors has supported this growth, with State Transport Undertaking (STU) tenders leading the way. The company also has a long-standing relationship with Tamil Nadu. Under the gross cost contract model, as of the June quarter of FY26, the company has delivered 100 e-buses to the state, with the remaining 600 to be delivered in stages.
Ashok Leyland’s Global Footprint: From Lucknow to Europe
In January 2026, Ashok Leyland opened its new EV plant in Lucknow. Right now, it can produce 2,500 buses a year, and the company plans to ramp this up to 5,000 over time.
Moving to OHM Global Mobility, in August 2025, Ashok Leyland approved an investment of ₹300 crore in this subsidiary, with a similar amount to be infused in the near future. Beyond ₹600 crore, the company is also planning to inject capital through different fundraising options.
In February 2026, Ashok Leyland’s OHM Global Mobility bagged an order to supply e-buses to the European market, with manufacturing to be carried out at its UAE plant and deliveries scheduled over 12 months. The company also received an order to deliver 45 e-buses to Bhutan.
Financial Snapshot: Profitability is Improving, But Not Fully Translating
In Q3FY26, Ashok Leyland posted total revenue of ₹14,830 crore, up by ₹2,253 crore sequentially and ₹2,835 crore on a year-on-year basis. Of the total Q3FY26 consolidated revenue, commercial vehicles contributed ₹12,770 crore, which is up by 28% on a quarterly basis and 22.5% on an annual basis. The remaining Q3FY26 revenue came from the financial services business.
When it comes to consolidated net profit, the company earned ₹862 crore in the December quarter of FY26. Again, after excluding taxes and interest, profit from commercial vehicles in Q3FY26 stood at ₹1,234 crore, an increase of ₹321.42 crore on a quarterly basis and ₹313.34 crore on a yearly basis.
Ashok Leyland Limited 5-Year Financial Performance
| Particulars | FY21 | FY22 | FY23 | FY24 | FY25 |
| Sales (₹ in crores) | 19,454 | 26,237 | 41,673 | 45,703 | 48,535 |
| Operating Profit (₹ in crores) | 2,462 | 2,765 | 5,093 | 7,856 | 9,208 |
| Net Profit (₹ in crores) | (70) | (285) | 1,359 | 2,696 | 3,383 |
| EPS (₹) | (0.3) | (0.6) | 2.1 | 4.2 | 5.3 |
In terms of price performance, Ashok Leyland shares surged by over 28%. However, on a year-to-date basis, share prices fell by 0.7%.
Believing in the long-term potential of Ashok Leyland, both FIIs and DIIs have raised their stakes in the December quarter by 0.9% to 24.4% and 0.14% to 13.73%, respectively.
Olectra Greentech vs Ashok Leyland vs Others
| Company | P/E | Dividend Yield (%) | ROCE (%) |
| Olectra Greentech | 69.64 | 0.03 | 20.52 |
| Ashok Leyland | 28.03 | 1.82 | 14.26 |
| Tata Motors Commercial Vehicle | 347.55 | – | – |
| JBM Auto | 68.15 | 0.15 | 14.20 |
The comparison shows clear positioning differences across players. Olectra Greentech appears as a high-growth, pure-play EV bet with stronger capital efficiency, though higher valuations reflect execution and margin risks. In contrast, Ashok Leyland offers a more balanced profile with steady cash flows, diversified operations, and relatively attractive valuation, but comparatively lower return efficiency.
Tata Motors trades at a steep premium, signalling high growth expectations but limited near-term earnings visibility in this segment. Meanwhile, JBM Auto sits between growth and value, with moderate efficiency and valuation, reflecting a stable yet less dominant positioning.
The Verdict: Risk Appetite vs. Long-Term Compounding
The overall opportunity size looks exciting, but it is not a straight ride for the incumbents.
Olectra Greentech is clearly riding early-mover advantage and strong order inflows, but rising costs and execution pressure are already squeezing margins, so growth may not fully translate into profits yet. On the other hand, Ashok Leyland offers stability through its core business, giving it the cushion to scale EVs without hurting overall earnings.
For investors, this boils down to risk appetite: pure EV plays offer potentially sharper upside but come with volatility and valuation risk, while diversified players provide steadier compounding. The smart approach is to track order execution, margin trends, and government policy support rather than just headline growth. In this space, patience and selective exposure matter more than chasing momentum.
It may be a good idea to add these stocks to your watchlist and keep track to see how they perform in time to come.
Note: We have relied on data from www.Screener.in throughout this article. Only in cases where the data was not available, have we used an alternate, but widely used and accepted source of information.
The purpose of this article is only to share interesting charts, data points and thought-provoking opinions. It is NOT a recommendation. If you wish to consider an investment, you are strongly advised to consult your advisor. This article is strictly for educative purposes only.
Rishabh Sinha is a seasoned financial content creator with over 10 years of experience in BFSI domain. His portfolio spans over 20 of India’s most trusted financial brands. Rishabh brings depth, structure, and a reader-first approach to every piece he crafts.
Disclosure: The writer and his dependents do not hold the stocks discussed in this article.
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