Kotak Institutional Equities has maintained a ‘Sell’ rating on Ola Electric and set a target price of ₹30, despite the EV company reporting lower-than-expected losses in Q1FY26. The brokerage remains cautious about volume trends and market competitiveness.
Ola posted a net loss of ₹428 crore, wider than ₹347 crore in Q1FY25, but better than estimates. Revenue halved to ₹828 crore, while EBITDA loss stood at ₹237 crore, compared to ₹205 crore YoY.
Kotak attributed the lower-than-expected loss to:
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Higher-than-expected volumes (including ~7,000 units backlog),
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Improved gross margins owing to the Gen-3 platform shift,
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Reversal in warranty provisions, and
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Effective cost containment.
Still, Kotak flagged that volume offtake remains below expectations, especially as the overall EV market in India sees muted growth amid increasing competition. While Ola is guiding for FY26 revenue between ₹4,200–4,700 crore, this implies a wide range of growth outcomes (-7% to +4%), underlining the uncertainty.
Kotak believes the firm needs to demonstrate stronger market traction to justify valuation expectations ahead of its anticipated IPO.
