Bhavish Aggarwal’s ‘Ola To A Conglomerate’ Vision, How Realistic Is It? And Can Conglomerates Afford To Run Like Ola?
Not too long ago, RPG Group Chairman Harsh Goenka took a dig at Ola. Sharing a picture of himself on an Ola electric scooter, he quipped, “If I have to travel close distances, I mean from one ‘kamra’ to another, I use my Ola.”
At first glance, it seems like a lighthearted joke. But scratch beneath the surface, and it’s clear that Goenka’s jibe was more than just banter, it was a subtle commentary on the challenges that Ola Electric has been facing. The remark came amidst a public spat between Ola CEO Bhavish Aggarwal and comedian Kunal Kamra, who had posted an image of Ola’s service centers packed with faulty electric scooters, questioning their reliability.
However, is it just about one high-profile tweet or a stand-up comedian’s many critiques, absolutely not.
Ola’s troubles are no secret, regulatory crackdowns, customer complaints, and an alleged toxic work culture have plagued the company. But despite all of this, Aggarwal is still gunning for an ambitious vision, turning Ola into a full-fledged conglomerate.
But can a conglomerate afford to function like Ola?
Let us start straight by addressing the elephant in the room—Ola’s way of doing business.
The ‘Move Fast, Break Things’ Culture, But What If You Keep Breaking?
Bhavish Aggarwal is often compared to Elon Musk, both are outspoken, risk-taking, and have a penchant for pushing boundaries. But there’s a crucial difference – hile Musk’s audacious bets (Tesla, SpaceX, Starlink) have largely translated into revolutionary successes, Ola’s execution has been, chaotic at best.
Ola started as a ride-hailing giant but soon pivoted aggressively into electric scooters, battery technology, AI, and even chip-making. But instead of structured scaling, what we have seen is a pattern of rushed launches, half-baked products, and knee-jerk reactions to market shifts.
Take Ola Electric, for instance. When it launched the S1 scooter, the hype was off the charts, aggressive pre-bookings, promises of cutting-edge tech, and an ambitious push for electric mobility in India. Yet, within months, the cracks started showing. Customers complained of scooters shutting down mid-ride, software glitches, delayed deliveries, and service center nightmares. The government even issued recalls due to fire risks.
Ola’s response was as expected, instead of focusing on fixing fundamental issues, the company doubled down on expanding into newer, shinier things, electric bikes, premium scooters, and, even an electric car!
But here is the problem – you can’t build a conglomerate by spreading yourself thin and ignoring your core product’s flaws. A conglomerate thrives on strong foundations, not reckless ambition. And while the tech industry loves the move fast, break things mantra, that only works if you actually fix what you break.
Regulatory Headaches & Financial Gymnastics. The Ola Way
If there’s one thing Ola has mastered apart from ambitious moonshots, it’s how to constantly stay on the radar of regulators and usually for the wrong reasons. From multiple lawsuits to allegations of anti-competitive practices, the company has been no stranger to controversy.
Ola’s internal governance practices raise eyebrows. Reports of sudden layoffs, abrupt leadership exits, and Bhavish Aggarwal’s own “unconventional” management style have fueled concerns. Multiple top executives, including CFOs, CTOs, and key operations heads, have exited the company over the years. While Bhavish insists he runs a high-performance culture, the churn suggests something deeper, either a lack of stability, internal discord, or a sheer inability to retain talent.
Ola has been on a financial rollercoaster. The core ride-hailing business has been struggling with post-pandemic recovery, higher fuel prices, and driver dissatisfaction. Ola Electric, meanwhile, burns cash at an alarming rate, pushing aggressive expansion while still dealing with existing quality issues.
Despite its grand vision, Ola has gone through multiple rounds of layoffs, signaling cash crunch issues and a desperate attempt to keep operations lean.
Ola’s Product Strategy. Hype vs. Reality
Ola it seems has mastered the art of hype – from its electric scooters to the ambitious Ola Electric car, Bhavish Aggarwal has positioned the company as a disruptor in the EV space. But how much of it is real, and how much is just aggressive marketing?
Ola’s S1 scooters generated massive interest, but the rollout was plagued with delivery delays, software issues, and customer complaints. While sales figures are improving, does the product quality match the promises?
Bhavish has been vocal about Ola’s upcoming electric car, touting futuristic features and a sleek design. But developing a four-wheeler EV is a different ballgame than scooters especially in a market where established giants like Tata, Mahindra, and even global players like Tesla are struggling with pricing and supply chain constraints. Can Ola realistically execute this vision?
Then there is the missing infrastructure piece, unlike Ather and other competitors, Ola has been slow in developing its own charging network. While they’ve announced Hyperchargers, the actual rollout has been limited. Without strong charging infra, how does Ola plan to compete with players investing heavily in this ecosystem?
Ather Energy, with steady growth and a focus on quality, has a far more measured approach to expansion while Tata Motors dominates the Indian EV car market and has deeper pockets.
The IPO Debacle
Let us talk about Ola Electric’s IPO, which debuted in August 2024, initially garnered strong investor interest. However, the stock price has since experienced a significant decline, as the company struggles with declining sales and a shrinking market share.
The IPO was priced between ₹72 and ₹76 per share and was met with strong demand, being oversubscribed by 4.26 times. Both Qualified Institutional Buyers (QIBs) and retail investors showed keen interest in the offering. The IPO consisted of a mix of a fresh issue of shares and an offer for sale (OFS) by promoters and existing investors. Before the public listing, Ola Electric secured ₹2,763 crore from anchor investors, further reinforcing confidence in the company’s potential.
Following its listing, Ola Electric’s stock saw an initial surge, gaining 20% on the first trading day. However, the stock has since experienced a sharp downturn, with some analysts estimating a correction of over 65% from its peak levels. The company’s market share has also suffered, hitting a 16-month low of 27%.
Adding to its woes, Ola Electric has faced a steep decline in sales, with a 64% month-on-month drop recorded in February. Financial concerns have also mounted, as the company’s losses jumped by 50% in the December quarter. As a result, the stock has fallen below its IPO price of ₹76, raising concerns among investors about the company’s long-term viability.
The Recent Crackdown
In its latest legal tangle, the company faced heat over its rapid expansion into physical showrooms but without the necessary paperwork.
Once a die-hard advocate of the digital-only sales model, Ola Electric has aggressively opened around 4,000 physical locations since 2022. But an investigation revealed that out of the 3,400 showrooms with available data, only a little over 100 had the mandatory trade certificates required under India’s Motor Vehicles Act.
Translation – more than 95% of Ola’s stores (at least the ones that could be verified) were operating without the basic legal certification needed to display, sell, offer test rides, or transport unregistered vehicles. Unsurprisingly, this has triggered a crackdown. Transport authorities across various states have raided showrooms, shut them down, seized vehicles, and issued show-cause notices to Ola, as per internal documents and government warnings.
A Perfect Storm of Problems
Its stock, which soared during its August 2024 IPO, has now plummeted by over 60% from its peak. Add to that a growing list of customer complaints about product quality, service issues, and social media backlash.
To make matters worse, the company is also laying off over a thousand employees and contract workers, citing restructuring and automation efforts. And if that wasn’t enough, Ola’s much-hyped electric motorcycles, promised for a January launch, are nowhere to be seen. Asked about the delay, Ola simply chose silence.
A Corporate Reshuffle on the Horizon?
Founder Bhavish Aggarwal is also now planning to restructure his business empire. His three ventures – Ola Consumer (Ola Cabs), Ola Electric, and AI startup Krutrim – are currently associate companies, not subsidiaries under one umbrella. A restructuring would bring them closer under a conglomerate-style model, with Aggarwal’s BA Family Office calling the shots.
First up on the restructuring list – Ola Maps, which has already been in the news after MapMyIndia accused Ola of data theft. Interestingly, instead of keeping Ola Maps under Ola Cabs (which collected most of its data), Aggarwal wants it under Krutrim, his AI venture.
Krutrim itself has some ambitious plans – AI chips, AI-driven maps, and large language models (LLMs). To fund all this, Aggarwal has pledged nearly ₹603 crore worth of Ola Electric shares in favor of Avendus and InCred-backed funds. In total, he has now pledged 8.09% of his personal stake in Ola Electric to secure funding for Krutrim.
The Last Bit
Turning Ola into a successful conglomerate is easier said than done. Unlike professional conglomerates such as Tata Group, Reliance, or even Adani, which have well-structured leadership, diversified revenue streams, and clear long-term strategies, Ola is still trying to figure things out.
A successful conglomerate thrives on synergy, but Ola’s ventures seem more like a collection of ambitious projects rather than a well-integrated empire.
Then there’s the issue of regulatory troubles. Professional conglomerates have strong legal and compliance frameworks in place, ensuring smooth operations across sectors. Ola, on the other hand, is constantly in the news for controversies – be it trade certificate violations in its electric vehicle business, MapMyIndia’s claims over Ola Maps, or backlash over its work culture. If a company is already struggling with compliance in its existing businesses, adding more verticals will only multiply the chaos.
Financially, the road looks bumpy too. Conglomerates require strong cash flow to support expansion, but Ola Electric’s stock has tanked over 60% from its peak, and the company is resorting to pledging shares just to fund Krutrim, its AI venture.
Finally, leadership matters. Conglomerates don’t just rely on one person; they have structured management teams running each vertical independently. Right now, Ola is heavily centered around Bhavish Aggarwal’s vision, which while ambitious lacks the depth of experienced industry leaders handling various segments. A one-man army can only go so far before cracks start showing.
