Ola Electric shares surged by 4.85% to trade at ₹76.25 on the NSE as of 12:07 pm, following a wave of positive sentiment stemming from recent company updates. The stock recovery, which saw shares rise over 2% from earlier lows, is attributed to Ola Electric’s optimistic commentary on service improvements, growth potential, and profitability outlook.
Key Drivers Behind the Surge
- Service Enhancements: Ola Electric highlighted that it has resolved all previous service-related issues, ensuring same-day or next-day servicing for customers. This reassurance has bolstered confidence in the company’s commitment to customer satisfaction.
- Market Share Goals: Ola is targeting a market share of 30-35% in the electric vehicle (EV) space, a bold objective that reflects its ambitious growth trajectory.
- Margin Improvement: The company expects substantial improvement in margins due to operational efficiencies, particularly with advancements in its Gen 3 platform, which is being executed ahead of initial timelines. This accelerated progress has been well-received by investors.
- Path to Profitability: Ola Electric has indicated that its journey to profitability might be achieved sooner than previously projected, a promising development for stakeholders.
- Analyst Support: Bank of America (BofA) maintained its ‘Buy’ rating on Ola Electric, setting a revised target price of ₹120, down from ₹145, which still suggests a 65% upside from the current market price of ₹72.67. BofA praised Ola’s steady gross margin delivery, operational improvements, and its positioning to benefit from the growing EV adoption.
Market Outlook
With multiple new launches expected, Ola Electric is poised to capitalize on the increasing demand for electric vehicles in India. The company’s proactive approach in addressing service issues and its aggressive growth strategy have reinforced its standing in the EV market, contributing to today’s upward momentum in share price.
