"BluSmart, Supported by BlackSoil, Achieves INR 500 Cr ARR in FY24, Targets 10,000 EV Fleet by 2024"

BluSmart, a ride-hailing service focusing exclusively on electric vehicles (EVs), is revving its engine for growth. The company recently announced a significant increase in revenue, solidifying its position in the competitive Indian ride-hailing landscape.

Revenue Growth and Ambitious Targets

BluSmart reported a noteworthy rise in revenue for fiscal year 2024 (FY24), exceeding Rs 390 crore compared to Rs 160 crore in FY23. This translates to a growth rate of over 140%. The company has also crossed an annualized revenue run rate (ARR) of Rs 500 crore, showcasing its rapid expansion.

Market Landscape and Competition

While BluSmart boasts impressive growth, it operates in a highly competitive market dominated by established giants like Ola and Uber. These players, along with newer entrants like Rapido and Namma Yatri, are vying for market share. Notably, BluSmart currently operates only in Delhi-NCR and Bengaluru, limiting its reach compared to its larger rivals.

Financial Performance of Competitors

In FY23, Ola Cabs reported a revenue increase of 58% at Rs 2,135 crore, while Uber witnessed a 54% growth in operating revenue to Rs 2,666 crore. Interestingly, Uber's ride-hailing revenue specifically stood at Rs 678 crore during the same period. Bengaluru-based Rapido, a bike-taxi focused platform, has also experienced significant growth, tripling its operating revenue to Rs 443 crore. However, despite their revenue streams, all these companies continue to operate at a loss.

Unique Business Model and Future Plans

BluSmart stands out by owning or leasing its entire fleet of electric cars and charging stations. This approach differentiates them from competitors who typically rely on independent drivers using their own vehicles. Additionally, BluSmart offers its drivers a unique combination of fixed salaries and performance-based incentives.

Looking ahead, BluSmart has set ambitious targets. The company aims to achieve Rs 800 crore in revenue by the end of FY25, reflecting their commitment to rapid growth. Their immediate focus will be on strengthening their presence in their existing markets of Delhi-NCR and Bengaluru by increasing market penetration and customer base.

Path to Profitability

While BluSmart demonstrates strong revenue growth, achieving profitability remains a challenge. The company expects to turn EBITDA-positive (earnings before interest, tax, depreciation, and amortization) only by March 2026. This extended path to profitability can be attributed to the capital-intensive nature of the EV ride-hailing business model.

Fundraising and Recent Developments

Despite facing challenges in securing substantial external capital in the past, BluSmart has managed to raise funds through a mix of strategies. In 2023, they conducted two smaller fundraising rounds totaling around $66 million, including a rights issue that increased founder stake. Additionally, the company secured $25 million in January 2024 from ResponsAbility, a Zurich-based climate finance firm. However, BluSmart's founder, Anmol Singh Jaggi, has recently faced scrutiny regarding alleged connections with a Dubai-based hawala operator.

Despite facing competition from established players and a delayed path to profitability, BluSmart's revenue growth and unique business model suggest a promising future. With a focus on deeper market penetration and continued strategic fundraising, BluSmart is well-positioned to become a major player in India's burgeoning electric ride-hailing market.