EV shares dropped 14% after the Maha Govt cancelled a Rs. 10,000 crore order

On Tuesday, the Olectra Greentech shares fell upto 14 percent on NSE, touching a day’s low price of Rs. 1,160.10 per share. The Maharashtra government has cancelled Rs. 10,000 crore electric bus order awarded to Olectra Greentech Limited and its consortium partner Evey Trans Pvt Limited due to the failure to meet delivery deadlines. The contract was signed in July 2023, which involved supplying, operating, and maintaining 5,150 electric buses for the Maharashtra State Road Transport Corporation (MSRTC) over 12 years. Under the agreement, Evey Trans was to procure buses from Olectra and then supply it to MSRTC within 24 months, while Olectra was responsible for maintenance, as per sources.

Recently, the transport minister and MSRTC chairman Pratap Sarnaik announced the cancellation following a review meeting. On a Social Media site, he revealed that despite being given a revised deadline to deliver at least 1,000 buses by May 22, the consortium failed to deliver a single bus by that date. Sarnaik expressed doubts about the ability to fulfill the remainder of the contract and ordered officials to cancel the tender agreement immediately.

The cancellation decision led to a sharp decline in Olectra Greentech’s share price, which fell as much as 14 percent in intraday trading on May 27, 2025. Olectra Greentech has not officially confirmed the cancellation but stated that it has not received any formal communication from MSRTC regarding the termination of the contract, as per various sources.

This news on cancellation came amid Olectra Greentech’s announcement of strong financial results for Q4FY25 and the full fiscal year FY25. For the fourth quarter of FY25, Olectra reported a net profit of Rs. 20.69 crore, a 39 percent increase year-on-year from Rs. 14.89 crore in Q4FY24, and revenue of Rs. 448.92 crore, up 55 percent year-on-year. The company’s EBITDA stood at Rs. 54 crore, and profit before tax (PBT) surged 45 percent to Rs. 29.25 crore in the quarter. The company’s order book as of Q3FY25 stood at 10,224 bus units.

For the full fiscal year FY25, Olectra Greentech reported an operational revenue of Rs. 1,801.9 crore, a 56 percent increase from Rs. 1,154.13 crore in FY24. EBITDA rose 49 percent to Rs. 260.60 crore, PBT surged 77.62 percent to Rs. 187.88 crore, and net profit jumped 76.98 percent to Rs. 139.21 crore from Rs. 78.65 crore in FY24. Earnings per share (EPS) improved significantly to Rs. 16.92 from Rs. 9.36 in the previous year. 90 percent of the revenue is earned from e-vehicle division and the remaining 10 percent from the Insulator division for FY25. Olectra’s Board of Directors recommended a final dividend of Rs. 0.4 per share on the face value of Rs. 4 per share, which is subject to shareholder approval.

Despite the results, the cancellation of the Maharashtra government order has negatively impacted Olectra’s share price. However, a proper clarification from the company on the news is awaited.