Olectra, JBM, PMI, Switch Mobility Hold 47% of India’s e-Bus Market in FY25: CareEdge

India is witnessing a gradual transition in electric buses, which remain in an early stage of adoption, accounting for roughly 4% of total annual bus registrations in FY25.

According to a recent CareEdge Research report, this segment posted a robust growth of approximately 16% in FY25 and 31% in 9MFY26 on a year-over-year (YoY) basis. Albeit on a low base, supported by central government incentives, enabling infrastructure, and favourable contracting terms under the GCC model. 

Currently, e-bus penetration in India remains low, but there has been a steady momentum over the past three years, reflecting greater policy thrust, cost economics, and execution depth. While early adoption was concentrated in a few large cities, deployments are now expanding into Tier II and Tier III markets.

Government support through incentives, enabling charging infrastructure, and favourable GCC/standardised OPEX frameworks is expected to continue, strengthening operator confidence—especially as STUs increasingly tender capacity under these models. With an expanding ecosystem, annual e-bus sales are envisaged to reach around 20,000 units in FY28, increasing penetration to around 13%,” said Arti Roy, Associate Director, CareEdge Ratings. 

Sizeable e-Bus Manufacturing & Growing Order Book  

CareEdge report the shift in market leadership towards a handful of OEMs, as a key enabler with support from players like Olectra, JBM, PMI, and Switch Mobility, collectively accounting for ~47% and ~76% of the market in FY25 and 9MFY26, respectively. 

A key contributor towards the increase in domestic manufacturing of E-buses is the spike in domestic manufacturing capacity, which has scaled to reach a combined installed capacity of approximately 32,000 e-buses/Annum for the 4 leading players.

It also found a shift in demand visibility, which is reinforced by an aggregate order book of ~31,000 e-buses with these 4 players, largely under STU/GCC arrangements with private fleet operators. 12–24-month execution timelines provide near-term visibility, supporting a steady ramp-up in capacity utilisation.

CareEdge noted that the pace and durability of this growth will hinge on timely disbursements and strict enforcement of PSMs. It also relies on a reliable grid supply and an adequately developed depot/charging infrastructure. Additionally, the electric buses market also relies on disciplined, on-schedule deliveries in line with contracted milestones. 

Potential for e-Bus Deployment 

As of February 04, 2026, e-bus registrations are concentrated in large urban centres, driven by high ridership demand and the urgency to control elevated pollution levels. Delhi leads with ~4,244 registrations, followed by Maharashtra (~4,038) and Karnataka (~2,309). While adoption is currently skewed towards major metros, deployments in Tier II and Tier III cities under PM e-Bus Sewa are expected to grow. 

However, India’s e-bus penetration remains well below global levels, at ~8 e-buses per million people, compared with a global average of ~94 per million. Given India’s large urban population, high reliance on buses, and intensifying environmental pressures, e-bus deployment is a high-impact lever for decarbonising mobility. While adoption is concentrated in a few states, programmatic expansion to non-metro markets is likely to make e-buses a mainstream component of public transport over the next decade. A delayed transition is perhaos also not a bad idea, allowing India to make possible technology jumps to more efficient, chgeaper buses, besides allowing the grid to adapt to the kind of fast charging demands these fleets will make.  

GCC Model is Evolving 

A notable structural shift in public transport procurement has been the transition from outright purchases by STUs to the GCC (OPEX) model, in which private operators procure, operate, and maintain buses. In contrast, STUs pay a per-kilometre (PKM) fee.

This framework has become prevalent, especially in larger cities, owing to its asset-light profile for fiscally constrained STUs and its efficient allocation of technology, maintenance, and battery-performance risks to operators. Centralised demand aggregation by agencies such as Convergence Energy Services Limited (CESL) has further accelerated the shift.

From a bankability perspective, standardised GCC contracts increasingly incorporate service-level agreements, inflation-linked escalations for electricity tariffs and wages, termination mechanisms, lender protections, and performance-linked incentives/penalties.

PSMs, escrow- or ring-fenced cash flows, performance guarantees, and DSRA help mitigate counterparty risk. The consistency and timeliness of payments from STUs remain the key variable; effective enforcement of safeguards is critical for lowering financing costs, supporting longer tenors, compressing PKM bids, and sustaining private participation.

CareEdge Ratings’ View

“E-bus procurement for public road transport is shifting decisively towards the GCC (OPEX) model, with private operators assuming technology, maintenance, and battery risks while STUs pay indexed per-kilometre charges. Improved contract terms—covering SLAs, inflation-linked wage and power escalation, termination clarity, and lender protections—along with escrowed cash flows, guarantees, and DSRA, have materially strengthened bankability and lowered financing costs," said Hardik Shah, Director, CareEdge Ratings. 

"The transition is reinforced by PM e-Bus Sewa and PM e-Drive, alongside the recent Union Budget announcement for ~4,000 additional e-buses and continued support for charging and depot infrastructure. With domestic manufacturing capacity of the leading 4 players ~32,000+ e-buses annually and an order book of ~31,000 units, it provides 12–24 months of execution visibility, supporting higher penetration. Sustained growth momentum, however, hinges on timely STU disbursements, depot/charging infrastructure readiness, and disciplined contract execution,” Hardik Shah added.