Ola Electric shares decline over 7 per cent after doubling investors' wealth in just 7 sessions

Ola Electric shares in Tuesday's session (August 20) marked their fresh record high of Rs 157.53, zooming as much as 8 per cent. Nevertheless, the stock slipped and last at around 12:20 pm traded weak by over 6 per cent at Rs 136.74, while at day's low it slipped 7 per cent to Rs 135.19 per share on the BSE.

Since its listing on August 9, the stock has doubled investors wealth in just seven trading sessions.

The company last week announced that it has strengthened its positioning in the market with the launch of electric motorcycles and announces integration of its own cells in EVs by Q1 FY26.

Mr Atul Parakh, CEO of Bigul noted that Ola that is the country's first pure-play EV maker is seeing a steep rally on the back of its strong foundations and strategic investments, clear focus on innovation and sustainability, and as it has the largest integrated and automated E2W manufacturing plant in India. The company is also aggressively investing in R&D and technology.

Positives and Negatives of Ola Electric as decoded by Zee Business Research 

Even if the market share of all the three other electric vehicle companies is added, Ola's market share in the e-2W segment is the highest at 34.8 per cent in FY24. 

Company                            FY24              FY23           FY22
OLA Electric                       34.8%             21%             5.7%
TVS Motor                         19.3%            11.3%           3.9%
Bajaj Auto                          11.3%             3.9%            2.8%
Hero MotoCorp                  1.9%              0.1%                -

Also, the company's latest e-motorcycles pricing throws a big competition to other ICE motorcycles.

Negatives

In comparison to peers, the company's distribution network still lags. Also, in comparison to the average P/S of 5.9x, Ola is trading at 12.2 P/S.
 
Valuation Comparison

Company                             Price to Sales (TTM)                       
OLA Electric                                  12.2x
TVS Motor                                      3.1x
Bajaj Auto                                       5.9x
Hero MotoCorp                             2.7x          
 
Also, the company has till now not ventured into exports of its product line.
 

Ola Electric Q1FY25 results

The company in the June quarter reported standalone revenue from operations at Rs 1,644 crore. In the same quarter last year, the company's revenue from operations was recorded at Rs 1,243 crore. For the reporting quarter, the company's loss was recorded at Rs 346 crore as against Rs 268 crore i