Indian electric vehicle (EV) ride-hailing platform BluSmart Mobility, which recently raised around $42 million in a mix of equity and debt funding from BP Ventures and several other existing investors, has firmed up plans to ramp up its existing fleet count to 10,000 electric cars by the end of this year. The Gurgaon-based EV startup, which commenced business in December 2019, has inducted 4,500 electric cars (4,000 in Delhi-NCR and 500 in Bengaluru) in its fleet so far.
“Seeing the exceptional response to our ride-hailing services, we are now looking to widen our footprint in Delhi and NCR. We will also be expanding aggressively in Bengaluru, where we entered last year and currently have 500 cars plying there,” Anmol Jaggi, Co-founder of BluSmart Mobility, told Moneycontrol.
He added, “In order to reduce the waiting time for our riders, we are looking to have at least 10,000 e-taxis by the year end.” Of that, 8,000 will be in Delhi-NCR and 2,000 in Bengaluru.
Jaggi, however, clarified that the company would continue to follow its business model of getting the vehicles on lease and having driver partners on its rolls (unlike Uber and Ola, where drivers own vehicles). The Indian ride-sharing firm has already raised Rs 1,200 crore for vehicle leasing and has already allied with Mitsubishi, Mahindra and Mahindra Finance, Gensol EV Leasing, LeasePlan, ALD Automotive, etc.
The numbers
“Considering that the average selling price of an electric car is Rs 15 lakh and about 6,000 more cars will be added, we will be leasing vehicles worth Rs 900 crore in the coming months. We have approximately 1.3 driver partners per car and will augment the headcount from 6,000 to around 13,000 by year-end.”
Asked how the business would become commercially viable, Jaggi clarified that for every vehicle sourced, it manages to earn Rs 80,000 per month, of which it pays Rs 22,000 as monthly rentals to the leasing firms.
“With our policies of zero cancellation, no surge pricing, clean cars, driver partners, our customer satisfaction levels are higher and operational costs are extremely low. In terms of our profitability, we are extremely close to breaking even in the Delhi market in the next three months,” Jaggi added.
India's first all-electric shared mobility platform, which usually does at least seven trips per day for every single car, has cumulatively logged about 220 million kilometres and 6.5 million trips till date. In the next three months, it is looking to cross 1 million trips per month across its fleet. However, the company has no plans to enter any new city in the next few quarters.
No immediate plans to induct e-hatches
Even while BluSmart is on an expansion overdrive, it has no near-term plans to add small e-cars such as the Tiago EV, MG Comet EV, etc., in its fleet. As Jaggi puts it, “...95 percent of our cars are Tata Tigors (the electric variant) and the other 5 percent will be the premium cars such as Hyundai Kona Electric, MG ZS EV and BYD E6 and the composition will remain the same.”
Asked about plans to go below the Tigor EV as part of its fleet expansion, Jaggi clarified, “As we speak, the (electric variant of) Tiago has not been offered to us by Tata Motors for commercial mobility applications. Small electric cars such as the Comet EV are of course revving up the market. But as a team, we are yet to take a final call on when we will have the hatchbacks. From that perspective, we are still in the evaluation stage and the current business model of running sedans (Tigor EV) is doing extremely well.”
Meanwhile, BluSmart Charge, a sister entity of BluSmart Mobility, has invested Rs 85 crore to set up 4,300 EV Chargers (fast and slow) across 25 hubs. It is now planning to spend another Rs 800 crore to establish 43,000 chargers across 250 hubs over the next four years.
“We are at the last stage of decision making when it comes to opening up this charging infrastructure to all the citizens of Delhi and Bangalore,” revealed Jaggi.
Business outlook
While BluSmart didn’t share its financials, the company’s filing with the Registrar of Companies, obtained by business intelligence firm Altinfo, shows that revenue from services stood at Rs 4.78 crore on a standalone basis and Rs 28.9 crore at a consolidated level in FY22. While the company’s financial figures for FY23 are not available in the public domain, BluSmart indicated that it is confident of registering a three-digit figures in its revenues during that period.
Asked about the projected topline, Jaggi said, “Startups are usually evaluated on the metric of Revenue Run Rate. Our average revenue run rate was about (Rs) 180 crore for FY 23. As we speak, we have ended the month of May with a Rs 300 crore Revenue Run Rate. And we expect that by the end of this year, we should be touching Rs 1,000 crore revenue run rate.”
In lay terms, revenue run rate, which is also known as the annual run rate or sales run rate, is a method of projecting upcoming revenue over a longer period such as a year on the basis of previously earned revenue.
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