Ola Electric lowers first-half depreciation by Rs 62 crore

Ola Electric Mobility Limited reduced depreciation expense by Rs 62 crore in the six months ended September 30, 2026 after technical evaluations revised the estimated useful lives of certain intangible assets, vehicles and tools. The change reduced depreciation by Rs 24 crore in the June 2026 quarter and Rs 38 crore in the September 2026 quarter.

What changed in Ola Electric’s depreciation accounting?

Ola Electric revised the estimated useful lives of certain intangible assets, vehicles and tools during the six months ended September 30, 2026. The company said technical evaluations supported the revisions, which reduced depreciation expense by Rs 62 crore over the April-to-September 2026 period.

Ola Electric applied the revised useful lives from April 1, 2026 for intangible assets and from July 1, 2026 for vehicles and tools. The filing does not identify the individual assets, disclose their previous or revised useful lives, or provide the technical criteria used in the evaluations.

The Rs 38 crore reduction in the quarter ended September 30, 2026 was Rs 14 crore higher than the Rs 24 crore recorded in the quarter ended June 30, 2026. The July 1, 2026 effective date for vehicles and tools coincided with the larger effect in the September quarter, although Ola Electric did not disclose an asset-category split of the quarterly figures.

How much did revised useful lives affect first-half expenses?

Ola Electric reported that the estimate revision reduced depreciation expense by Rs 62 crore for the six months ended September 30, 2026. This is the quantified effect disclosed in the results notes and is not a forecast of depreciation for the year ending March 31, 2027.

The consolidated cash-flow statement reported depreciation and amortisation expense of Rs 245 crore for the six months ended September 30, 2026, compared with Rs 337 crore in the corresponding six months of 2025. The combined line therefore declined by Rs 92 crore year on year, while the useful-life revision accounted for Rs 62 crore of depreciation reduction in the 2026 period.

The Rs 62 crore adjustment represents about two-thirds of the Rs 92 crore decline in the reported depreciation-and-amortisation line. Ola Electric did not attribute the full year-on-year movement to the revised useful-life estimates, so the filing does not identify the causes of the remaining difference.

Why did Ola Electric revise asset useful lives?

Ola Electric said the revision followed technical evaluations of certain intangible assets, vehicles and tools. Intangible assets were covered from April 1, 2026, while vehicles and tools were covered from July 1, 2026, creating two separate implementation dates within the six-month reporting period.

The disclosure concerns an accounting estimate for assets already held by Ola Electric rather than a financing transaction. In the same six months ended September 30, 2026, the group acquired property, plant and equipment worth Rs 301 crore, compared with Rs 167 crore a year earlier, while development expenditure on internally generated intangible assets fell to Rs 17 crore from Rs 123 crore.

Ola Electric does not disclose whether the revised estimates affected any particular automotive or cell activity. Its reportable segments are Automotive, covering automobile sales and related services, and Cell, covering cell sales, while some corporate and support costs are not allocated to segments under the chief operating decision maker's review.

What do the first-half results show alongside the accounting change?

Ola Electric reported a consolidated loss before tax of Rs 698 crore for the six months ended September 30, 2026, compared with a loss before tax of Rs 846 crore in the corresponding 2025 period. The Rs 62 crore depreciation reduction lowered a reported expense during a period in which the group remained loss-making before tax.

Net cash used in operating activities increased to Rs 403 crore in the six months ended September 30, 2026 from Rs 343 crore a year earlier. Management attributed the negative operating cash flow to continued operating losses, lower-than-expected growth in sales volume and increased material costs.

Management said its going-concern assessment considered cash and bank balances, projected operating cash flows of material subsidiaries, available credit limits and rights-issue proceeds. The consolidated results were approved on November 12, 2026, and the statutory auditors expressed a qualified review conclusion on the consolidated results for the quarter and six months ended September 30, 2026.

What other matters could affect Ola Electric’s reported results?

Ola Cell Technologies Private Limited, a subsidiary of Ola Electric, received a Ministry of Heavy Industries letter dated August 11, 2026 granting a conditional waiver of liquidated damages under the Advanced Chemistry Cell Battery Storage Production Linked Incentive programme. The subsidiary had carried a cumulative Rs 57 crore provision at March 31, 2026 and wrote back the full provision in the June 2026 quarter.

Management said no further provision was needed for the quarter and six months ended September 30, 2026 because it expected Ola Cell Technologies to meet the milestones within revised timelines. The subsidiary has provided an unconditional bank guarantee of Rs 125 crore in connection with the programme agreement and its investment-related milestones.

Ola Electric also said it could not reliably estimate the cost of meeting Extended Producer Responsibility requirements for end-of-life vehicles as at September 30, 2026. The rules took effect on April 1, 2025 and require original equipment manufacturers to buy certificates equal to 8% of steel used in applicable commercial vehicles during the first five years, rising to 18% by 2039, while policy details remain under clarification.

Conclusion

Ola Electric’s Rs 62 crore first-half reduction in depreciation resulted from revised useful-life estimates for certain intangible assets, vehicles and tools following technical evaluations. The effect increased from Rs 24 crore in the June 2026 quarter to Rs 38 crore in the September 2026 quarter, while the broader depreciation-and-amortisation cash-flow line fell Rs 92 crore year on year to Rs 245 crore.

The next reporting periods will show the continuing effect of the revised estimates after the July 1, 2026 implementation for vehicles and tools. Investors can also watch whether Ola Cell Technologies meets the revised Advanced Chemistry Cell programme milestones, as the August 11, 2026 waiver of liquidated damages remains conditional on investment and other requirements.