Shares of Ola Electric Mobility surged 20 percent to Rs 133 in the afternoon on August 16 after receiving its first-ever 'Buy' rating post June quarter earnings that were released earlier this week.
HSBC initiated coverage on the newly listed company with a price target of Rs 140, suggesting a potential upside of 26 percent from Wednesday's closing price. Though HSBC has a conservative stance on EV penetration in India, the brokerage believes Ola Electric is 'worth investing in' due to sustained policy support, ability to reduce costs, and a favourable risk-reward profile for the battery venture.
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Ola Electric sold 49 percent of all the electric two-wheelers in the June quarter, and HSBC noted that the company has ambitious plans to manufacture most of the necessary EV components within India, including the battery.
The company reported its Q1 earnings on August 14, posting a net loss that widened to Rs 347 crore due to higher financing cost that nearly doubled to Rs 67 crore compared to last year. Ola's overall expenses rose to Rs 1,849 crore from Rs 1,461 crore last year.
Read MC Pro's analysis of Ola Electric's June quarter results here.
August also marked Ola's entry into the electric motorcycle segment with the launch of 'Roadster' series on Thursday. The bikes will be available in the range of Rs 75,000 to Rs 2.5 lakh in three variants — Roadster, Roadster X, and Roadster Pro — each of which will have sub-variants.
At about 12:20 pm, shares of the company were trading at Rs 132, up 19 percent from the last close on the NSE. Ola Electric Mobility shares have surged 68 percent since its debut when the shares listed at Rs 76.
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