Bounce Scooter Rental Business

Bounce has recommenced its scooter rental service featuring electric two-wheelers produced in-house, marking a significant shift towards a recurring revenue model aimed at gig and delivery workers. This Bengaluru-based electric mobility startup is on the verge of deploying 14,000 scooters for rental use and anticipates reaching 20,000 shortly, based on insights from individuals familiar with the company’s operations.

Revenue Growth in the Rental Sector

The rental division is currently generating an annualised revenue run rate of approximately $15 million. Bounce disclosed an impressive Rs 44.05 crore in consolidated operating revenue for FY26, with rental services becoming its primary source of income, contributing Rs 35.78 crore or around 81% of the overall operating revenue, as indicated by its financial reports reviewed by Startup Superb.

Profitability Metrics

In addition, the company reported an EBITDA of Rs 9.59 crore for the fiscal year. Although this reported EBITDA consisted of some non-cash elements, sources familiar with the business noted that Bounce has attained profitability at the group level. The company registered a Profit After Tax (PAT) margin of approximately 19% in July.

Transition from Sales to Rentals

Bounce initially concentrated on selling electric scooters directly to consumers. However, it has now revitalised its rental operations using its own electric vehicles, with Bounce Daily specifically catering to gig and delivery workers who require two-wheelers for their jobs without the upfront investment of purchasing one.

Recurrence and Manufacturing Control

This rental model enables Bounce to secure a consistent revenue flow while utilising its manufacturing capabilities more efficiently. Unlike competitors that rely on external Original Equipment Manufacturers (OEMs), Bounce manages the design, manufacturing, and maintenance of the vehicles directly, as noted by insiders.

Cost Structure and Financial Overview

This comprehensive approach is crucial to the company’s financial dynamics. Bounce’s scooters are uniquely designed for gig workers, and in-house manufacturing diminishes reliance on outside suppliers for components and part replacements, potentially reducing vehicle downtime.

Impact on Financial Statements

The changes are evident in the company’s cost structure for FY26. As scooter sales declined, material expenses saw a substantial decrease, and rental income became the primary contributor to operating revenue. Bounce’s total expenses were approximately Rs 76 crore during this timeframe.

Contextualising EBITDA

However, the reported EBITDA requires some clarification. Bounce reported Rs 23.32 crore in other income, primarily due to the favourable write-back of GST input credit, which is considered a non-cash component. Additionally, it accounted for around Rs 11.4 crore in non-cash charges, including Rs 7 crore linked to the FAME subsidy and Rs 4.4 crore related to advances, inventory, and receivables.

Adjusted EBITDA Figures

After accounting for these factors and Employee Stock Ownership Plan (ESOP) costs, the company’s adjusted EBITDA reflected a loss of Rs 1.83 crore for FY26. Its consolidated net loss stood at Rs 5.48 crore, while cash flow from operating activities was negative at Rs 6.23 crore.

Future Directions for Bounce

The latest operational metrics indicate that the rental business has progressed past the reported base for FY26. With nearly 14,000 scooters in operation and a trajectory towards 20,000, the crucial question is whether Bounce can maintain fleet utilisation and profit margins as it expands.

Strategic Advantages

For Bounce, the benefit extends beyond merely owning a rental fleet. Its integrated manufacturing and rental model enhances its control over vehicle availability, maintenance, and product design. If the company can sustain high utilisation rates while managing acquisition and operational costs effectively, rentals could evolve into a more sustainable venture than its previous model of consumer sales.