Ola Electric stock extends gains to 5th straight day, jumps another 6% to 7-week high

Stock Market Today: Ola Electric share price continued its winning streak for the fifth consecutive session, rising another 6.24% in morning trade on Thursday, November 28, to a seven-week high of ₹93.60 apiece. 

The stock of the Bhavish Aggarwal-led company has been making headlines recently, driven by a positive brokerage outlook and the company's plans to maintain its leadership in the electric two-wheeler (2W) market.

On Tuesday, Ola Electric announced its entry into the commercial segment with the launch of its 'Gig' range of scooters, priced at ₹39,999, targeting gig workers who have to travel longer distances with heavier payloads.

Additionally, the company launched the S1 Z model, a personal-use electric scooter aimed at urban commuters, with an introductory price of ₹59,999. These new scooters are equipped with portable batteries that can double as inverters, using the Ola PowerPod to power small household appliances, such as lights, fans, and other essential devices, the company said.

In addition to the Ola Gig and S1 Z ranges, Ola Electric offers an extensive S1 scooter portfolio with six variants at various price points, catering to customers with different range needs.

The premium models, S1 Pro and S1 Air, are priced at ₹1,34,999 and ₹1,07,499, respectively, while the more affordable S1 X portfolio, which includes 2 kWh, 3 kWh, and 4 kWh variants, is priced at ₹74,999, ₹87,999, and ₹1,01,999, respectively.

In another positive development, global brokerage firm Citi Research initiated coverage on Ola Electric stock with a ‘buy’ rating and a target price of ₹90 per share.

Citi Research believes that the company’s profitability will improve as capacity utilisation increases. The brokerage also highlighted the service issues that Ola Electric has faced in recent months, which have also affected the stock price.

Citi noted that if the product offering remains attractive, these service challenges will likely ease over the medium term as the company’s back-end supply chain improves.

Furthermore, Citi Research believes that India’s larger electric vehicle (EV) original equipment manufacturers (OEMs) like Ola Electric could dominate the market and remain profitable with an optimal cost structure and industry consolidation.

The brokerage also highlighted key risks for Ola Electric, including lower sales of two-wheeler EVs, heightened competition, negative perceptions regarding product and service quality, and continued losses.

Shares surge 40% in just 5 days

The recent recovery has propelled the stock 40% higher over the past five trading sessions.

Despite this strong rebound, the stock is still trading 41.40% below its all-time high of ₹157.40 per share, which it reached in mid-August. However, it is currently trading 20.8% higher than its IPO price of ₹76.

Disclaimer: The views and recommendations given in this article are those of individual analysts. These do not represent the views of Mint. We advise investors to check with certified experts before taking any investment decisions.