Ola recorded loss of Rs 796 crore for FY15 as it spent heavily to maintain market lead
Ola, which in fiscal 2015 was competing with two major rivals — Uber and TaxiForSure — spent Rs 920 crore on fleet operation costs.
In the same period the company earned total revenue of Rs 421 crore, an eight-fold increase over the previous year, according to the most recent disclosures filed with the ministry of corporate affairs earlier this month.
ANI Technologies, which owns Ola, has classified the bulk of the revenue of Rs 380 crore as coming from the car rental service while the company earned Rs 2.26 crore through commission on taxi services. Ola did not reply to ET's email seeking comment.
Ola which in fiscal 2015 was competing with two major rivals - Uber as well as TaxiForSure - spent an estimated Rs 920 crore on fleet operation costs. Advertisement and sales promotion was the next largest expense at Rs 100 crore. TaxiForSure, which was owned by Serendipity Infolabs, was acquired by Ola in February of 2015 in a primarily stock deal worth an estimated $200 million.
Ola commands more than 60 per cent-65 per cent market share according to industry estimates, while burning as much cash as its rival Uber according to a letter by Association of Radio Taxis. The letter said Ola and Uber are incurring operating cash losses of Rs 400-500 crore every month.
Since then, Ola which is backed by Japan’s SoftBank, has moved aggressively to establish its market lead over the San Francisco based Uber, which has said that a significant portion of its most recent fund raise of $3.5 billion will be used to expand its Indian operations.
Last week, ET reported that Ola has expanded into two additional categories - outstation and rental - in a bid to cover all sections of the transportation industry.
The company now offers a bus service called Ola Shuttle, auto rickshaw hire, carpooling, corporate car hire and five categories of on-demand cab service from low-cost Micro to luxury cars like BMW’s.
Uber on the other hand is focussing on its low-cost UberGo and UberX category in the 26 cities that it operates in. Ola is operational in more than 100 cities.
Ola, is also backed by China’s largest taxi app company Didi Chuxing, which participated in Ola’s last round of fund raising of $500 million. Other major shareholders include Matrix Partners, Tiger Global, and DST Global.