The pace at which ola scaled leads to such service issues. Even management admitted that the service capabilities didn’t grow in line with production and distribution. The problem is the industry they are playing in. 1st it’s capital intensive. I agree that this forms as entry barrier. But at the same time the capital requirements might lead to continuos rising of capital which inturn leads to shareholders value dilution. As we know they will only survive if they retain market share but this inturn leads to continuos capital requirements. They attaining decent profitability in such a competitive industry will not be a normal feat. And coming to r&d looking at attrition and easy availability of tech everyone wants to play ev theme. Will they be the lone survivor and dominant player like indigo or airtel(I don’t know). Let’s be frank, this is purely founder play according to me. Agree it or not Bhavish is one of the few passionate enterpreneurs that India has ever produced. Not comparing him with Elon but the guy is passionate!! But businesses don’t work on just passion. I want this company to succeed. But the deep pocket and reputed competition(existing players and new players like aether), bad reputation, easy entry in ev segments all may hamper his vision. In automobile sector valuation of the company plays crucial role especially for rising capital in future. If market perception is not good, value erosion will be that much faster.
Disc: have small tracking portion in ola. But completely respect the man behind ola.( Happy to take counter argument. Here to learn:))
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