Ola Electric's founder, Bhavish Aggarwal, is making a significant bet on home battery systems as the electric vehicle (EV) giant faces challenges in attracting investors. Once a highly sought-after IPO last year, Ola Electric is now encountering reluctance from financiers for its new fundraising rounds. This shift in investor sentiment comes amid shrinking market share and a substantial drop in the company's share price.

Ola Electric's struggles are underscored by a 43% drop in revenue and a 47% plunge in sales in the latest quarterly results. The company has also lowered its second-half sales expectations, estimating full-year results to be approximately 40% below earlier projections. As a result, the company is finding it difficult to raise capital. Several financiers have declined to back a proposed ₹1,500-crore equity raise. Lenders are also hesitant about a separate ₹1,700-crore debt plan approved by Ola's board in May, citing deteriorating financial performance.

In response to these challenges, Aggarwal is now focusing on home battery storage as a means to revive growth. Ola Electric has launched its Ola Shakti line of lithium-ion backup power systems, targeting households and small businesses. These systems are priced starting at ₹29,999 for the 1.5 kWh variant and going up to ₹1,59,999 for the 9.1 kWh variant. Ola Shakti is the first residential battery energy storage system (BESS) in India that is fully designed, engineered, and manufactured domestically using the 4680 Bharat Cells.

Aggarwal expects battery consumption for storage systems to reach 5 GWh in a few years, potentially exceeding automotive use. The company will utilize its cell manufacturing and distribution infrastructure for these systems, ensuring no additional capital expenditure. The company projects ₹1 billion in revenue in the March quarter when sales begin, and a "median guidance" of ₹10 billion in revenue from this venture for the year ending March 2027.

However, analysts remain cautious about Ola's prospects in the home battery market. The overall India inverter-battery market is worth ₹16,000 crore, and achieving a 7% to 8% first-year share for Ola will be "challenging given limited brand presence and distribution moat," according to Kotak analysts. Moreover, the home battery storage market is dominated by lead-acid based systems from established players, which sell at a fraction of the price of Ola's lithium-ion cell packs.

Despite these challenges, Aggarwal remains optimistic about Ola Electric's future. At a recent event, he unveiled a transformative vision for India's electric mobility future, emphasizing pioneering battery technology and a firm commitment to self-reliance. Ola Electric aims to become the world's number one in electric vehicles and energy. The company has scaled rapidly, from launching its first electric scooter in December 2021 to building a high-capacity Gigafactory in just four years.

Ola Electric is also focusing on vertical integration to improve margins. By producing its own batteries, the company aims to reduce costs and enhance efficiency. Ola Electric plans to integrate its 'Bharat 4680' cell into its vehicles starting in Q1 FY26.

However, Ola Electric has faced criticism regarding product quality and after-sales service. There have been instances of customers expressing frustration with their e-scooters and the company's service. Experts say that Ola needs to address these issues to improve its reputation in the market.