Ola to be profitable in two years: Bhavish Aggarwal

Cab hailing services firm Ola is gaining market share and expects to become profitable in two years, said Bhavish Aggarwal, chief executive of ANI Technologoies Pvt Ltd, which owns Ola.

“Our focus remains to build a robust and an impactful business,” Aggarwal said on Friday at India Internet Day, an event organised by The Indus Entrepreneurs (TiE), a non-profit global network of entrepreneurs and professionals.

Home grown Ola and its US-based rival Uber Inc. are both recovering from setbacks stemming from nationwide strikes by their drivers over the issue of withdrawal of incentives and bonuses.

Aggarwal said Ola was working towards building a sustainable business model that would balance prices for both drivers and riders. “We have introduced intercity cab services, corporate bus services so that same set of drivers see a career path with us… the ones who own one car, are able to become fleet owners,” he added.

Aggarwal said ride-sharing was an intense business worldwide, but disagreed that it is not a winner-takes-all market.“Competition is such that ride-sharing companies were giving customers discounts and drivers were getting subsidised, a nature of competition that other (traditional) sectors like FMCG (fast-moving consumer goods) haven’t seen, who fought on margins.”

“(Competition between) Uber and Didi was (like) World War II, both had nuclear bombs (heavily funded)…China had an advantage over its foreign rival; India is not like that.”

In 2016, Uber sold its China operations to rival Didi, ending an expensive price war and increased its focus on other markets, including India, a market it cannot afford to lose, according to a Mint report in August.

Ola claims it has more than 500,000 drivers and the number will grow to two to three million in next few years. Aggarwal said the company is setting up institutes to skill drivers and that 10 such have already been established.

Ola and Uber together completed about 500 million rides in 2016, nearly a fourfold increase from a year earlier, according to a report by market research and advisory firm RedSeer Management Consulting Pvt. Ltd, Mint reported in February.