💰 Financial Performance

Revenue Growth by Segment

The company operates in the slow-speed electric vehicle (EV) segment, including 2-wheelers and 3-wheelers. H1 FY26 revenue reached INR 134.78 Cr, representing an 80% YoY growth. Q3 FY26 revenue grew 67% YoY to INR 91.62 Cr, driven by festive demand and deeper penetration in Tier-2 and Tier-3 markets.

Geographic Revenue Split

Zelio has a pan-India presence across 25+ states and Union Territories with a network of 360+ dealers. The company is strategically expanding into East and South India through a new facility in Odisha to reduce regional reliance and logistics costs.

Profitability Margins

Zelio has been profitable since inception. FY25 PAT was INR 16 Cr with a PAT CAGR of ~124% since FY23. H1 FY26 PAT grew 70% YoY to INR 11.8 Cr, maintaining a net margin of approximately 8.7%.

EBITDA Margin

FY25 EBITDA was INR 21 Cr (12.2% margin). H1 FY26 EBITDA reached INR 15.36 Cr, up 71% YoY, reflecting a margin of 11.4% despite scaling operations.

Capital Expenditure

The company is investing less than INR 3 Cr for the Odisha plant. Other planned capex includes the Patan manufacturing facility (expected April 2026) and the ongoing construction of the Hisar plant to support a 1 lakh unit annual target by FY27.

Credit Rating & Borrowing

Not disclosed in available documents; however, the company emphasizes zero subsidy reliance and zero equity dilution beyond the IPO, indicating a self-sustaining capital structure.

⚙️ Operational Drivers

Raw Materials

Key raw materials include auto components such as motors, controllers, and batteries. Imports accounted for 71.51% of total costs in FY25, which the company aims to reduce through localization.

Import Sources

Import markets (primarily implied as China/overseas given the CKD assembler status) currently supply 71.51% of components.

Capacity Expansion

Current installed capacity is 72,000 units per annum. The company is executing a ~70% expansion to reach 1,20,000 units per annum by February 2026.

Raw Material Costs

Raw material costs are heavily influenced by imports (71.51% in FY25). The company is targeting 80% localization by FY28 to optimize costs and improve margins through manufacturing efficiencies.

Manufacturing Efficiency

Expected FY25-26 capacity utilization is ~85% on the existing 72,000-unit base. The new Odisha facility is expected to improve regional supply efficiency and logistics economics.

Logistics & Distribution

Distribution is handled through a 360+ dealer network. The company focuses on 'Bharat' (Tier-2/3) to minimize aggressive marketing spend, relying instead on dealer productivity.

📈 Strategic Growth

Expected Growth Rate

35-40%

Growth Strategy

Growth will be achieved by scaling capacity from 72k to 120k units by Feb 2026, commissioning the Patan 3-wheeler plant by April 2026, expanding the dealer network to 500+ by FY28, and increasing localization from 30% to 80% to improve unit economics.

Products & Services

Slow-speed electric 2-wheelers (EEVA, Gracy), rugged 3-wheelers (Tanga), and high-speed electric scooters (Mystery).

Brand Portfolio

Zelio, EEVA, Gracy, Tanga, Mystery.

New Products/Services

The high-speed electric scooter 'Mystery' and the 3-wheeler 'Tanga' are expected to diversify the portfolio and contribute to the FY27 target of 1 lakh units.

Market Expansion

Targeting East and South India through the Odisha plant (Feb 2026) and evaluating a Southern India assembly facility to deepen penetration in Tier-2 and Tier-3 markets.

Market Share & Ranking

Zelio holds a ~5% market share in the slow-speed EV industry and ranks among the top 3 players in the slow-speed EV 2W segment.

Strategic Alliances

Financing tie-ups for 3-wheelers with 6-7 companies including Bajaj and Kotak Mahindra to support customer livelihood purchases.

🌍 External Factors

Industry Trends

The slow-speed EV industry is growing at a 30% CAGR, while Zelio is outperforming at an 84% CAGR. The industry is shifting toward 'Aatmanirbhar' manufacturing and deeper rural penetration.

Competitive Landscape

Competes with larger players like Ola and Ather, but distinguishes itself by being profitable and focusing on the slow-speed segment for 'Bharat' rather than premium high-speed urban markets.

Competitive Moat

Zelio's moat is its consistent profitability (unlike loss-making peers Ola and Ather), a robust 360+ dealer network, and a focus on the 'no-license' segment which lowers the barrier to entry for consumers. This is sustainable due to low marketing spend and high RoE (85.75%).

Macro Economic Sensitivity

Highly sensitive to the 'Bharat' economy (Tier-2/3/Rural), where demand is driven by affordability and the lack of license/registration requirements for slow-speed EVs.

Consumer Behavior

Targeting students, housewives, and senior citizens who prioritize affordability, reliability, and ease of use (no registration required).

Geopolitical Risks

Trade barriers or supply chain disruptions in import markets could significantly impact the 71.51% import-dependent cost structure.

⚖️ Regulatory & Governance

Industry Regulations

Operations are governed by ICAT certifications for vehicle models (e.g., Tanga and Mystery). The business model relies on the current regulatory exemption for slow-speed EVs (no license/registration).

Environmental Compliance

The company holds ISO 14001:2015 (Environmental Management) and ISO 45001:2018 (Occupational Health and Safety) certifications.

⚠️ Risk Analysis

Key Uncertainties

The primary risk is the 71.51% import dependency for components, which could lead to supply chain bottlenecks or margin compression if localization targets (80% by FY28) are not met.

Geographic Concentration Risk

Currently focused on 25+ states; the Odisha plant is a strategic move to mitigate over-reliance on Northern India and capture East/South markets.

Third Party Dependencies

High dependency on import markets for 71.51% of raw materials; partially mitigated by the new auto components subsidiary.

Technology Obsolescence Risk

The shift toward high-speed EVs could threaten the slow-speed segment; Zelio is mitigating this by launching the 'Mystery' high-speed scooter.

Credit & Counterparty Risk

Not disclosed; however, the dealer-led model typically involves secured channel financing or upfront payments.