Ride-hailing giant Uber is in the early stages of talks to acquire BluSmart, an electric vehicle-based cab service company, as its parent company, Gensol Engineering, is looking to exit the capital-intensive business, sources told Moneycontrol.
The talks come in as BluSmart's parent company Gensol Engineering is facing liquidity issues. BluSmart has denied holding such a discussion with Uber.
"BluSmart categorically denies any discussions or negotiations regarding an acquisition by Uber. The report suggesting such a development is entirely speculative and unfounded. As India’s leading EV ride-hailing and charging infrastructure platform, BluSmart remains focused on scaling its operations, expanding its footprint, and driving sustainable mobility forward," BluSmart's spokesperson said responding to Moneycontrol's queries.
Gensol, primarily known for its solar engineering, procurement, and construction (EPC) business, ventured into the electric vehicle space through BluSmart. BluSMart when it was launched in 2019 was positioned as India's answer to Uber and Ola, offering fully electric cabs as a green alternative in the rapidly growing urban transport market.
However, the business has faced multiple hurdles over the years. The high costs of fleet acquisition, EV charging infrastructure development, and driver incentives have weighed heavily on BluSmart’s finances. Despite raising significant capital from investors, including bp Ventures and other institutional backers, profitability has remained elusive.
Also Read: MC Explains: Why did Gensol Engineering shares crash 80% from highs?
Uber declined to comment on the acquisition. Economic Times reported the development first.
BluSmart initially gained traction by differentiating itself as a premium, no-surge pricing service with cleaner, more sustainable transportation options. It also strategically positioned itself in cities like Delhi-NCR and Bengaluru, focusing on corporate customers and airport transfers to ensure consistent demand.
But competition from deep-pocketed rivals like Uber and Ola, which have also expanded their electric vehicle fleets, has intensified. Unlike its competitors, BluSmart owns and operates its fleet rather than relying on driver-owned vehicles, a strategy that has significantly increased its capital expenditure.
Moreover, the company's reliance on subsidies and government incentives for EV adoption has been a double-edged sword. Delays in subsidies, coupled with rising financing costs for EV purchases, have put further pressure on its operations. Recent reports suggest that the company has struggled to raise fresh funding, which could be one of the key reasons behind Gensol’s decision to reassess its role in the business.
In 2024 the firm raised around $24 million in funding from existing investors, including BP Ventures, as well as contributions from the founders and the leadership team.
The EV firm was founded in December 2019 by Anmol Jaggi, Punit K Goyal and Puneet Singh Jaggi with the idea of bringing a new, greener ride-hailing option to the massive Indian market. The firm raised $109 million across its seed and Series A rounds till date.
BluSmart claims to have crossed $50 million in annual revenue run rate and is growing at more than 100 percent year-on-year. It has an ecosystem with over 4,000 EV chargers across its 35 charging locations in Delhi-NCR and Bangalore. Besides, it has around 6,000 EVs as part of its ride-hailing business.
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