Ola Electric Mobility Ltd, a subsidiary of the Ola Group, is India’s largest electric vehicle (EV) manufacturer, revolutionizing the country’s mobility sector. Founded with the vision to accelerate the adoption of electric vehicles, Ola Electric designs, manufactures, and sells electric scooters, focusing on sustainability and innovative technology.
The company aims to reduce carbon emissions and provide affordable, eco-friendly alternatives to traditional vehicles. As the leading EV player in India, Ola Electric is paving the way for a greener future by expanding its product range, building charging infrastructure, and driving the transition to electric mobility across the country.
Share Price
The shares of Ola Electric Mobility are currently trading at Rs. 85.82 up by 0.81% from its previous close of Rs. 85.07 as of December 31, 2024
Price Target
Goldman Sachs’ Positive Outlook for Ola Electric
Goldman Sachs, the international brokerage firm, has given a strong endorsement to Ola Electric Mobility Ltd, projecting impressive growth for the company in the next few years. The brokerage firm expects Ola Electric’s revenue to grow 2.5 times faster, and its volumes to increase 5 times faster compared to its peers in India’s two-wheeler market. The forecast is largely driven by Ola Electric’s strong presence and focus on the rapidly expanding electric two-wheeler segment, positioning it as a leader in the market.
Buy Rating and Target Price
Goldman Sachs has initiated coverage on Ola Electric with a “Buy” rating, setting a target price of Rs 160 per share. This target represents an 88% upside from the company’s current stock price. The firm’s analysis reflects confidence in Ola Electric’s future growth potential, supported by its leadership in the electric vehicle space and its aggressive plans for market expansion.
Revenue and Volume Growth Projections
Goldman Sachs expects Ola Electric to grow its revenues by over 40% annually between FY24 and FY27, significantly outpacing its competitors, including TVS Motor, Bajaj Auto, and Hero MotoCorp, which are projected to grow at much slower rates of 16%, 19%, and 10%, respectively. The firm also forecasts annualized volume growth of 57% for Ola Electric, further strengthening the company’s growth story.
Product Roadmap and Market Expansion
The brokerage highlights Ola Electric’s upcoming product launches as key catalysts for growth. The roll-out of its electric motorcycle portfolio starting in March 2025 and its entry into the electric three-wheeler market in mid-2025 are expected to drive further expansion. These developments, combined with the growing demand for electric vehicles, make Ola Electric an attractive investment opportunity.
Resignation by top management
Suvonil Chatterjee: Chief Technology and Product Officer, resigned from Ola Electric. He joined in 2017 as Head of Design and played a key role in projects like Ola Maps and Krutrim.
Anshul Khandelwal: Chief Marketing Officer, resigned from Ola Electric. He joined in 2018 as Head of Marketing and was part of the leadership team at Ola.
N Balachandar: Group Chief People Officer, stepped down in November.
Sidharth Shakdher: Chief Business Officer, Ola Consumer, resigned in October after nine months to join Paytm as Chief Marketing Officer and Business Head.
Mahesh Alanthat: Vice President and Head of Sales, Ola Electric, resigned in October. Kartik Gupta: Chief Financial Officer, ANI Technologies (Ola’s parent), resigned in May. Hemant Bakshi: CEO, of Ola’s mobility business, resigned in May.
The resignation of key executives at Ola Electric and its parent company, ANI Technologies, raises concerns among investors as it signals potential instability within the leadership team. High-level departures, particularly from positions like Chief Technology Officer, Chief Marketing Officer, and CEO, can disrupt strategic initiatives, delay projects, and affect overall company performance. Such exits may also create uncertainty about the company’s future direction, leading to diminished investor confidence and negatively impacting stock prices and growth prospects.
Employee Layoff
In the past few months, Ola Electric also laid off 300-400 people across departments but mainly in manufacturing and supply-chain management roles. The company is also facing a decline in market share, increased customer complaints, and a fall in its stock price.
In its IPO prospectus, Ola Electric, which listed on the bourses in August this year, said it witnessed a high employee attrition rate in the past. In FY24, the employee attrition rate was 44.25%.
Conclusion
Despite Goldman Sachs’ optimistic target price of Rs. 160 and projected revenue growth of 40% annually between FY24-27, Ola Electric faces significant internal challenges. The resignation of seven key executives, including the Chief Technology Officer and Chief Marketing Officer, coupled with layoffs of 300-400 employees and a high attrition rate of 44.25%, raises concerns about the company’s stability. These management upheavals, along with declining market share and increasing customer complaints, could impact the company’s ability to achieve its ambitious growth targets.
Written By: Dipangshu Kundu
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