Olectra Greentech Sinks 14% After Maharashtra Scraps ₹10,000 Cr E-Bus Order

Shares of Olectra Greentech Ltd witnessed a sharp decline on May 27, dropping as much as 14% to an intraday low of ₹1,160 after the Maharashtra state government announced the cancellation of a high-value electric bus order due to the company’s failure to meet delivery deadlines. The 12-year ₹10,000-crore contract, initially awarded in July 2023 to a consortium comprising Olectra and Evey Trans Pvt Ltd, has now been officially scrapped, with the state citing non-performance as the key trigger for the decision.

Highlights:

• Olectra Greentech shares tanked 14% in early trade after Maharashtra scrapped the bus contract.

• The ₹10,000-crore order was awarded for 5,150 e-buses over 12 years.

• Maharashtra Transport Minister cited zero deliveries by May 22 as reason for cancellation.

Government Blames Missed Deadlines and Project Inaction

Maharashtra’s Transport Minister Pratap Sarnaik took to social media platform X on Tuesday to confirm that officials had been directed to cancel the contract due to the supplier’s failure to begin deliveries. Though the post did not name Olectra explicitly, it was widely understood to refer to the Olectra-Evey consortium. Sarnaik revealed that not a single unit out of the 1,000 buses scheduled for handover by May 22 had been delivered. The minister noted that this decision followed a detailed review meeting held the previous evening at the MSRTC headquarters in Mumbai.

Highlights:

• Transport Minister flagged zero progress despite revised delivery schedule.

• State officials instructed to terminate contract after internal review.

• Order cancellation affects delivery of 5,150 buses for MSRTC.

E-Bus Contract Details and Financial Implications

The contract entailed Evey Trans procuring electric buses from Olectra and supplying them to the Maharashtra State Road Transport Corporation (MSRTC) over a 24-month period. Olectra was responsible for maintaining the fleet over the full 12-year term. The deal was one of the largest e-bus orders in the country and represented a significant share of the company’s long-term revenue visibility. The cancellation of the contract raises serious concerns about Olectra’s orderbook execution and reliability, and it could have material implications for its growth outlook, particularly in the state-owned public transport segment.

Highlights:

• Order cancellation jeopardizes future earnings visibility from the MSRTC deal.

• Project was expected to be a major revenue and service contract for Olectra.

• Market participants fear reputational and financial repercussions for the company.

Stock Performance and Investor Sentiment Shift

At 9:30 AM, Olectra shares were trading 6% lower at ₹1,266 after hitting a low of ₹1,160 earlier in the session. Despite strong recent quarterly results and a 13% gain over the past month, the stock has now dropped 9.2% year-to-date. The cancellation of the contract appears to have undermined investor confidence and triggered broad-based selling. Analysts have noted that the announcement introduces a degree of execution risk into Olectra’s business model, which had been gaining traction amid India’s aggressive e-mobility push.

Highlights:

• Shares down over 9% in 2025 despite recent gains.

• Negative sentiment driven by contract cancellation overrides positive Q4 earnings.

• Execution risk seen as a key concern following delivery failure.

Strong Q4 Earnings Overshadowed by Order Blow

The adverse development comes just days after the company reported robust March-quarter earnings. Olectra posted a 58% year-on-year increase in revenue, while net profit doubled. EBITDA rose 70%, and margins expanded by 100 basis points. However, these results were overshadowed by the order cancellation, raising questions about the company’s ability to translate its financial momentum into operational success. The company is expected to address investor concerns during its scheduled analyst call on Wednesday, May 28, at 4:30 PM.

Highlights:

• Q4 revenue rose 58% YoY, net profit doubled.

• EBITDA jumped 70%, with 100 bps margin expansion.

• Analyst call scheduled on May 28 likely to provide clarity on future order pipeline and response to cancellation.