Ola Electric has recently secured Production Linked Incentive (PLI) certification for its S1 X electric scooters, specifically the 3 kWh and 4 kWh models. This certification confirms that the scooters meet the minimum localization criteria of 50%, as required by the Ministry of Heavy Industries, making Ola Electric the only electric two-wheeler manufacturer to have four products certified under the PLI scheme.
The PLI certification is significant for Ola Electric as it will allow the company to receive incentives ranging from 13% to 18% of the determined sales value of these scooters over the next five financial years, starting from FY24. This development is expected to positively impact the company’s financial performance, as the S1 X models contribute to nearly half of its revenue.
As of the last trading session, the stock closed at ₹137.72, down by 5.69%. The average price was ₹144.69, with a trading volume of over 2 million shares. Analysts have expressed caution regarding the stock, citing ongoing losses and high volatility. For instance, the company’s consolidated net loss widened to ₹347 crore in the June quarter, compared to ₹267 crore in the same period last year.
HSBC Global recently initiated coverage on Ola Electric with a ‘Buy’ rating and a price target of ₹140, indicating a potential upside. However, some analysts suggest that new investors should consider waiting for a more stable entry point due to the company’s financial uncertainties.
In addition to the PLI certification, Ola Electric has been expanding its product lineup, recently launching its electric motorcycle series, the Roadster. The company’s ongoing efforts to enhance local manufacturing and supply chains are aligned with India’s broader electric vehicle strategy, but the market will be closely monitoring its ability to achieve profitability amid a competitive landscape.
Disclaimer: Data in this story is accurate as of the last updated/published time: August 21, 2024, 7:16AM.
