Ola Electric has reversed its provision of ₹57 crore, which was earmarked for a penalty against the government’s battery-cell production-linked incentive (PLI) scheme in the June quarter, thus narrowing its losses in Q1.The reversal helped Ola Electric narrow its net loss to ₹336 crore in the April-June quarter from ₹428 crore a year earlier. Without the reversal, the company’s loss would have stood at ₹393 crore. Revenue, meanwhile, fell 45 per cent y-o-y to ₹455 crore.Auditor BSR & Co, however, issued a qualified conclusion on the company’s unaudited consolidated financial results over the treatment, noting that the Ministry of Heavy Industries (MHI) had not formally approved the extension of the investment timeline or waiver of liquidated damages as of June 30.The provision relates to Ola Cell Technologies Pvt Ltd (OCTPL), a subsidiary of Ola Electric, which had agreed with MHI in July 2022 under the National Programme on Advanced Chemistry Cell Battery Storage. The agreement required OCTPL to meet specified investment milestones within prescribed timelines.IFCI, the project management agency for the ACC PLI scheme, issued a notice to OCTPL in March 2025 citing delays in achieving the milestones and levied liquidated damages under the programme agreement. The cumulative provision stood at ₹57 crore as of March 31, 2026.OCTPL had also placed an unconditional bank guarantee of ₹125 crore in connection with the matter. During the June quarter, it sought an extension of the timeline and waiver of the liquidated damages from MHI and did not create any further provision from April 1.The company said that, based on various discussions with MHI, it was confident of obtaining the approval and accordingly wrote back the entire existing provision, recognising the corresponding credit in other expenses.Founder and CEO Bhavish Agarwal said he expects operating expenses to decline further to ₹300-325 crore over the next few quarters.Published on August 10, 2026