MAM
Navigating the risks of electric vehicle startups
Mumbai: The electric vehicle (EV) transition is well under its way in India. As our urban centers swell and environmental concerns grow, the attraction of EVs only increases. Yet, for startups in this promising industry, the road is filled with both grand opportunities and formidable challenges.
Today, an EV startup begins its journey in the backdrop of robust government support and a societal shift towards sustainability. The government has implemented measures such as the faster adoption and manufacturing of hybrid and electric vehicles (FAME) scheme, which incentivizes both manufacturers and consumers through subsidies and benefits. This policy framework is critical because it lowers the barriers to entry for new players and reduces the cost burden on consumers. Additionally, as environmental consciousness rises among our population, more consumers are drawn to EVs as a cleaner alternative to traditional combustion engines.
However, the path for EV startups is not without obstacles. One of the most significant hurdles is the high initial cost of electric vehicles, primarily due to the expensive batteries that power them. These costs pose a considerable challenge in pricing EVs competitively against conventional vehicles. Additionally, the infrastructure for charging these vehicles is still in its infancy. The lack of widespread and easily accessible charging stations and battery swapping facilities creates ‘range anxiety’ – a concern that EVs can’t undertake long journeys without running out of power.
Compounding these challenges is the dependency on international markets for critical components like lithium, used in batteries. This reliance exposes Indian startups to global supply chain volatility and potential disruptions, which can impact both production schedules as well as costs. While diversifying supply sources and investing in local capacities may mitigate these issues, they don’t help in the short term. Furthermore, the current market offers limited models of EVs, limiting consumer choice and potentially slowing down the rate of adoption.
Despite these challenges, there are also vast opportunities. The ongoing expansion of charging infrastructure, driven by both public and private investments, promises to gradually alleviate range anxiety. This expansion will not only make EVs more practical for daily use but also opens up new business avenues for startups focused on charging solutions and battery technology.
Potential technological collaborations also present another bright spot. Partnerships between Indian startups and leading global tech companies can introduce cutting-edge advancements in battery life and vehicle efficiency into our market. These collaborations are vital for keeping pace with the rapid technological evolution in the EV space and staying competitive against both domestic and international automotive giants.
Also, as mentioned earlier, growing urban congestion will boost demand for efficient and clean transportation, offering a continuously growing market for EVs. This local growth, coupled with the potential for exporting to other developing nations, provides a lucrative opportunity for scale and impact.
However, navigating this landscape requires more than just innovative technology and government support; it demands a strategic approach to managing risks. EV startups must be agile, ready to adapt to technological advancements and leverage data analytics to anticipate shifts in consumer preferences. They must also continue advocating for consistent government policies to ensure a stable investment and operational climate.
Ultimately, the success of EV startups in India will hinge on their ability to turn these challenges into stepping stones. By leveraging government incentives, adopting advanced technologies, and continuously innovating in response to infrastructure and market needs, these companies can not only survive but thrive. The journey of electric vehicle startups in India will indeed be a testament to the dynamic interplay of risk and opportunity – a story of navigating uncharted territories to build the future of our transportation.
The article has been authored by entrepreneur and graduate of Harvard Business School Sajju Jain.
Brands
Kwality Wall’s reports standalone losses following strategic HUL demerger
Ice cream major faces Rs 64 crore Ebitda loss amid commodity inflation and muted Q3 sales
MUMBAI: Kwality Wall’s (India) Limited (KWIL) has released its first set of financial results as a standalone entity, revealing a challenging start to its independent journey. Following its successful demerger from Hindustan Unilever Limited (HUL) on 1st December 2025 and its subsequent listing on 16th February 2026, the company is navigating a transition period marked by structural changes and high input costs.
For the quarter ended 31st December 2025, the company reported revenue of Rs 222 crores. Despite the revenue base, the bottom line was impacted by several factors, resulting in an Ebitda loss of Rs 64.2 crores. When calculated on a Pre-IND AS 116 basis, the Ebitda loss stood at Rs 83.8 crores.
Organic Sales Growth (OSG) declined by 6.5 per cent year-on-year during the quarter. Volume growth, however, saw a marginal increase of 1.2 per cent. The company reported a gross margin of 41.5 per cent. Additionally, exceptional expenses amounting to Rs 94 crores were recorded, primarily linked to non-recurring costs during the transition phase.
Performance across portfolios and channels was mixed. Within the impulse portfolio, brands such as Magnum and Cornetto recorded mid-single digit volume growth, indicating steady demand in on-the-go consumption. However, the in-home portfolio, which includes take-home packs, experienced muted consumption. The company is planning a relaunch of this category with improved offerings ahead of the 2026 season.
Quick commerce (Q-Com) continued to emerge as a strong growth driver, delivering robust double-digit growth during the quarter. Meanwhile, the company also expanded its physical distribution network by increasing the number of company-owned cabinets across markets.
Margin pressure during the quarter was driven by a combination of one-off factors and broader cost inflation. Gross margins were impacted by around 600 basis points due to trade investments made for stock liquidation. Additionally, cocoa price inflation contributed to another 400 basis points of pressure on margins.
Deputy managing director Chitrank Goel attributed the muted performance partly to prolonged monsoons and transitional challenges linked to the GST framework. Operating expenses also increased as the company invested in establishing its standalone supply chain, operational systems and corporate infrastructure following the demerger.
Looking ahead, the management remains focused on a volume-driven growth strategy. To restore profitability, the company has initiated a cost productivity programme aimed at reducing non-consumer-facing costs. It is also working on building regional manufacturing networks to optimise logistics expenses and improve operational efficiency.
The commodity outlook for the near term remains mixed. Dairy prices are expected to remain firm due to tight supply conditions and rising fodder costs. Sugar prices may also move higher following increases in the Minimum Selling Price (MSP). While cocoa prices have moderated recently, currency depreciation has offset some of the potential cost relief for the company.
