Ola Electric Mobility Ltd shares continued their downward move in the August 26 trade, falling sharply by 5 per cent.
Earlier this month, shares of Bhavish Aggarwal-led electric two-wheeler company listed at Rs 76 apiece on the NSE. Within a few sessions, the counter more than doubled to hit a record high of Rs 157.53 on the BSE August 20.
However, ever since, the scrip has been on downtrend, falling 22 per cent in the last five sessions. The stock is down 23.37 per cent from its record high last Tuesday when it hit Rs 157.53.
The company’s market capitalisation has reduced to Rs 53,327 crore as on August 26, compared to a Rs 64,411 crore on August 19.
Bourses BSE and NSE have put the securities of Ola Electric under the short-term ASM (Additional Surveillance Measure) framework. Exchanges put stocks in short-term or long-term ASM frameworks to caution investors about high volatility in share prices.
A few analysts largely suggested that the counter could be corrected further. Those who invested for listing gains can consider booking some profit, one of them stated.
“Currently, the company has been losing about Rs 24,000 per vehicle. To recover from this, battery costs need to be brought down. As soon as the company start its own manufacturing, it will be in a position to bring down battery costs. When it happens, then the company will be showing the first signs of turning into profit,” said Deven Choksey, MD at DRChoksey FinServ Pvt Ltd.
“Whether it is happening in 2024-25 or 2025-26, the answer is no. Maybe somewhere in 2025-26, we will get the indication for the 2026-27 financial year where it will show first signs of bringing down the battery costs and make a profit on vehicle business. Despite all this, the stock had grown because there is no pure focus on EV OEM (original equipment manufacturer) in the market,” the market expert added.
“Investors with a high-risk appetite and long-term horizon can add this stock. For those who invested for listing gains can take some profit off the table,” said Kranthi Bathini, Director of Equity Strategy at WealthMills Securities.
Technically, the stock is not looking good on charts and can slip towards Rs 110 level over the near term, said Ravi Singh, Senior Vice-President (Retail Research) at Religare Broking. Investors should wait to buy the dip, Singh added.
The company’s net loss widened by about 30 per cent year-on-year for the quarter ended June 30 to Rs 347 crore. The firm’s consolidated revenue from operations rose 32 per cent to Rs 1,644 crore as against Rs 1,243 crore in Q1FY24.
The Rs 6,145-crore initial public offering of Ola Electric Mobility had a fresh issue of up to Rs 5,500 crore and an Offer-for-Sale (OFS) of up to 8,49,41,997 equity shares.
Ola Electric was founded in 2017. It is a pure-play electric vehicle player that primarily manufactures electric vehicles and certain core components for electric vehicles such as battery packs, motors, and vehicle frames at the Ola Futurefactory.
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