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Ola Share Price : The continued decline in Ola Electric's stock has dealt a significant blow to investors, with the company shedding nearly ₹40,000 crore from its peak valuation. The Bhavish Aggarwal-led firm, which was initially valued at ₹66,000 crore after its stock market debut, has now seen its market capitalization shrink to ₹26,187.81 crore.
Since its listing at ₹76 per share in August last year, Ola Electric's stock has been under persistent selling pressure. On Tuesday, it dipped over 3% to an all-time low of ₹58.84 on the Bombay Stock Exchange (BSE).
Factors Behind the Decline: Mounting Losses and Falling Revenues
Several challenges have contributed to the stock’s continued decline, including widening financial losses, decreasing revenues, persistent service issues, and concerns over a broader market correction in India.
In its latest earnings report, Ola Electric disclosed a 50% increase in its consolidated net loss, rising from ₹376 crore in Q3 FY24 to ₹564 crore in Q3 FY25.
Adding to its woes, the company’s operating revenue dropped by 19%, falling from ₹1,296 crore in the previous quarter to ₹1,045 crore. In its stock exchange filing, Ola Electric attributed these setbacks to an "intensely competitive market and service-related challenges."
Despite these issues, the company insists it has resolved its service challenges and remains committed to expanding its presence in the electric two-wheeler segment.
Shrinking Market Share and Regulatory Scrutiny
Ola Electric’s market share in the electric two-wheeler sector has seen a drastic decline, dropping from 49% in June 2024 to below 20% by December.
The company acknowledged this trend in a stock exchange filing on February 7, stating, "October witnessed strong performance led by festive sales; however, the overall quarter was weak due to a highly competitive environment and service challenges."
Further compounding its troubles, the Central Consumer Protection Authority (CCPA) has issued a ‘show cause’ notice to Ola Electric, citing allegations of misleading advertisements and unfair trade practices. The regulatory body has demanded multiple clarifications from the company as part of its ongoing investigation.
Looking Ahead
As Ola Electric navigates these financial and regulatory challenges, investors remain cautious about the company's future trajectory. While the firm continues to emphasize its long-term growth strategy in the EV market, it will need to address its financial instability and regain investor confidence to reverse its downward spiral.
