This EV stock, which operates in the business of manufacturing electric vehicles and its core components, declined upto 8 percent after its subsidiary received the petition on Insolvency Proceedings.
Price Action
With a market capitalization of Rs. 20,616.22 Crores, the shares of Ola Electric Mobility Limited were down by 7.63 percent in the day’s trade touching a day’s low of Rs. 46.68 per share. The stock reiterated and was trading at Rs. 46.74 per share, which is 7.52 percent lower than the previous closing price of Rs. 50.54 apiece.
The stock has delivered a negative return of 48.68 percent and has underperformed the Nifty Index from the time of listing on the bourses.
What Happened
The company’s stock is in focus and Ola Electric’s wholly owned subsidiary Ola Electric Technologies Private Limited has received a file petition from Rosmerta Digital Services Limited, which is an operational creditor for Ola Electric Tech.
The petition is related to an alleged default in payment towards the services provided by the Operational Creditor and seeks a start of the Corporate Insolvency Process on Ola Electric’s subsidiary. The petition is submitted in the National Company Law Tribunal (NCLT) – Bengaluru Bench.
Stock Correction
The company stock after listing surged to a 52-week high to Rs. 157.53 per share within 1 or 2 weeks from its IPO listing price of Rs. 76 per share, showcasing around a 107 percent increase in stock price. Now, the stock is trading near its all-time low of Rs. 46.68 per share, which translates to around 70.36 percent.
Future Plans
Ola Electric Mobility has come up with new models in the EV Motorcycle segment, which is the Roadster series to tap the largest 2W market segment. Further, the company announced product launches such as S1 Pro+, Ol Gig, Gig+, and S1 Z to tap new customer segments across personal and commercial mobility.
The company is building 4680 Bharat Cells, which would power their products from Q1FY26, thus reducing battery costs to improve margins.
Ola Plans for Profitability
The company plans to improve its profitability based on three key factors, such as Gross Margin improvement through Generation 3, in-house cell production, and vertical integration.
Followed by Operational cost optimization while investing in R&D Technology. Further introducing new products and entering into new segments. Ola Electric expects the Auto segment to be EBITDA breakeven at ~50,000 monthly deliveries.
Recent Update on Plans to Profitability
The recent initiatives have helped the company to reduce the cost of Rs. 90 crores per month, and it expects to achieve the Automotive segment EBITDA breakeven for the Q1FY26, with financial impact to reflect from April 2025.
Business Mix
The company earns the majority of its operational revenue from Automotive, which contributes around 99.71 percent, followed by 0.28 percent from Cell for the December 2024 quarter. The Operating Loss in both segments is increasing on a year-on-year basis.
About the Company
Ola Electric Mobility Limited, founded in 2017, specializes in manufacturing electric vehicles (EVs) and core components like battery packs and motors. It operates from its Futurefactory and has launched several models, including the Ola S1 series.
Financials
The company’s revenue from operations declined by 19.36 percent year on year from Rs. 1,296 Crores in Q3FY24 to Rs. 1,045 Crores in Q3FY25, accompanied by a loss of Rs. 376 Crores to a loss of Rs. 564 Crores.
Written by Santhosh S
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