Business News/ Companies / News/ Eka Mobility to invest ₹800 crore to ramp up electric bus production
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Eka Mobility, the electric bus maker promoted by India's Pinnacle Industries and backed by Japan’s Mitsui Corporation and Dutch VDL Groep, plans to invest ₹800 crore this financial year to expand capacity and ensure timely delivery of buses to state governments and private operators.
Eka Mobility, the electric bus maker promoted by India's Pinnacle Industries and backed by Japan’s Mitsui Corporation and Dutch VDL Groep, plans to invest ₹800 crore this financial year to expand capacity and ensure timely delivery of buses to state governments and private operators.
The investment will be funded through a mix of equity and debt, helping it increase the number of buses it can deliver every month, a top company official said. Including the planned outlay, the company would have invested over ₹1,800 crore since its inception in 2022.
The investment will be funded through a mix of equity and debt, helping it increase the number of buses it can deliver every month, a top company official said. Including the planned outlay, the company would have invested over ₹1,800 crore since its inception in 2022.
The investment wave in the electric bus segment comes at a time when Megha Engineering’s Olectra Greentech drew flak from the Maharashtra state government over delayed deliveries, leading to the cancellation of a 5,000-bus order that was later reinstated.
Production ramp up
“We will not face any issues in deliveries of electric buses as we ramp up the capacity in our plants," Sudhir Mehta, founder and chairman of Eka Mobility, told Mint in an interview.
Mehta said that the company will expand its capacity to manufacture 500 electric buses a month by the end of this fiscal year, from 250 currently. According to the company, it has an order book of over 3,300 electric buses in India and some markets in Africa.
The company has two plants in Pune, and a third one is being built in Pithampur, Madhya Pradesh. Eka Mobility manufactures electric buses and small commercial vehicles, with the company competing with the likes of Tata Motors, JBM Auto, Ashok Leyland and PMI Electro Mobility Solutions Ltd in the ebus segment.
In 2023, Eka inked a strategic partnership with Mitsui and VDL Groep, securing technology collaboration and joint investments of ₹830 crore. While Mitsui focused on bringing capital into the company, Eka is collaborating with VDL to bring the technical know-how for making electric buses.
Eka is one of the subsidiary companies of the Pune-based Pinnacle Industries, a nearly three-decade-old automotive seat and interior maker.
In FY25, the country saw a total of 3,314 electric bus sales, 6% lower than the previous year. Of these sales, Tata Motors had a market share of 32%, with 1,058 e-bus deliveries while Olectra had a 21% share with 710 deliveries, data on government’s Vahan portal showed.
Eka, in contrast , had just 72 deliveries, with a 0.3% market share last year but Mehta says that the capacity is increasing rapidly. Between April and September this year so far, Eka has registered and delivered 163 electric buses with its market share rising to 8%.
In FY24, the company incurred a loss of ₹32 crore while revenue was at ₹53.1 crore, according to its filings. But Mehta is sure that as deliveries ramp up, the company will manage to make a space for itself with investments in the right place.
Competition and outlook
The company’s competitors are also ramping up their investments, with Ashok Leyland announcing a ₹500 crore infusion in its electric bus arm earlier this year.
Through its acquisition of SML Isuzu, Mahindra and Mahindra could soon enter the electric bus segment while JSW is also building its commercial vehicles, which includes electric buses slated to be launched from next financial year.
“Increasing competition in the sector is good. It will help in expanding the segment and also meet the growing demand," Mehta contends. “The buses of public transport are going to be electrified but what is also an interesting opportunity for us is the rise of electric intercity buses."
But will the rise of big players' interest in the segment hurt Eka? Mehta doesn’t think so. “Everyone is starting from the same space in the EV segment. For investments and technology, we already have global partnerships so there is no worry about not being able to match the competitors"
Industry experts have repeatedly emphasized that for electric bus makers, the key lies in ensuring timely deliveries.
“The next two years are crucial which will test the production capabilities of the major original equipment manufacturers (OEMs). There are government and private orders pending so there is an expectation that investments will be made in boosting production capabilities," Sanyam Gandhi, director at transport solution provider Chartered Speed, had earlier told Mint.
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