Ola Electric Share Price Update: Insights and Predictions for September 18, 2024
Ola Electric Mobility’s share price is the focus of attention among investors. Recent developments in the market have sparked interest, particularly following the initiation of coverage by major brokerage firms. This article explores the latest news surrounding Ola Electric shares and provides insights into expected price movements.
Main Points
Ola Electric shares experienced a significant boost on September 17, 2024, rising over 6% to close at ₹114.30. This surge was primarily driven by positive ratings from two prominent financial institutions: Goldman Sachs and Bank of America (BofA). Both firms initiated coverage with “buy” recommendations, projecting substantial upside potential for the company’s stock.
- Goldman Sachs set a target price of ₹160, indicating a potential upside of 48% from the previous closing price.
- BofA Securities projected a target price of ₹145, suggesting a potential upside of 34%.
These optimistic forecasts are based on Ola Electric’s strategic positioning in the growing electric two-wheeler market in India. Goldman Sachs anticipates that Ola will achieve EBITDA breakeven by FY27 and expects an impressive revenue growth rate of over 40% CAGR from FY24 to FY30. By FY30, they predict an EBITDA margin of 11.9% and a return on invested capital (ROIC) of 27%.
Despite this recent uptick, Ola Electric’s shares have faced volatility since their listing in August 2024. After an initial surge to an all-time high of ₹157.53 shortly after debuting at ₹76, the stock fell significantly due to profit booking and market corrections. Currently, it remains over 30% lower than its peak.
Impact of Lock-In Period Expiration
Another factor influencing share price is the expiration of a one-month lock-in period for approximately 18.18 crore shares, which occurred on September 9, 2024. The end of this lock-in period allowed these shares to become eligible for trading, leading to some pressure on the stock price as investors adjusted their positions.
While Ola Electric is well-positioned in the electric vehicle (EV) sector, it faces competition from established players who are also venturing into electric two-wheelers. Concerns regarding battery technology and manufacturing capabilities have been raised by analysts. However, BofA believes that Ola’s technology leadership and cost efficiency provide it with a competitive edge in this rapidly evolving market.
Broader Market Trends
The Indian electric two-wheeler market is witnessing increased adoption rates, currently around 6.5%, with expectations to rise significantly in the coming years. Analysts predict that this penetration could reach 18% by FY28 and 25% by FY30, driven by favorable pricing dynamics as electric scooters become more affordable compared to traditional petrol scooters.
Disclaimer: The information given in this article is from investment experts and brokerage companies, they do not represent Local Haryana. Before taking any investment related decision, you must consult a certified expert.
