Ola Electric's shares have surged by 47% in the last 30 days, with a 20% increase observed in the past five trading sessions. Investor confidence has grown due to the Gen-3 scooter range receiving recognition under the Production Linked Incentive (PLI) scheme and the potential benefits on sales.
Ola Electric Shares: Ola Electric's shares have been on a b rally recently. The shares have jumped by up to 47% in the last 30 days, while a 20% increase was seen in just five trading sessions. The company's Gen-3 scooter line has received recognition under the Production Linked Incentive (PLI) scheme, which could provide a 13-18% benefit on sales. Although the company incurred a loss of ₹428 crore in the June quarter, this new initiative is expected to have a positive impact on future profits and EBITDA.
Reasons for the Rally
According to analysts, this surge in Ola Electric's shares is due to several reasons. The primary reason is the recognition of the company's Gen-3 scooter line-up under the Production Linked Incentive (PLI) scheme. This scheme could provide the company with a benefit of 13 to 18 percent on its sales, and this benefit will continue until 2028. Ola states that this move will reduce costs and increase profits.
The company has stated that the Gen-3 scooter range constitutes more than half of its total sales. Now, both the Gen-2 and Gen-3 ranges have received this certification. This is expected to bring stability and growth to the business. Investors view this move as having a positive impact on the company's EBITDA levels.
Loss and Revenue
However, the June quarter results indicate that the company still incurred losses. During this period, Ola Electric's loss was ₹428 crore, compared to ₹347 crore in the same quarter last year. Revenue also decreased by approximately 50 percent year-on-year to ₹828 crore. In the same period last year, it was ₹1,644 crore.
Experts say that even though the company is currently incurring losses, the PLI scheme and the popularity of the Gen-3 range are strengthening investor confidence. This strategy can prove beneficial in increasing profits in the future.
Shares Boost Investor Enthusiasm
The rally in Ola Electric's shares has boosted investor morale. The continuous surge in shares clearly indicates that the market values the company's long-term growth prospects. With the Gen-3 range receiving PLI recognition, investors are hopeful that the company can further strengthen its business.
Business Stability
The Gen-3 scooter line-up is important for the company as it makes up more than half of the total sales. Furthermore, the recognition of the Gen-2 range will ensure stability in sales. According to Ola, this initiative will reduce the company's costs and improve profitability.
Analysts believe that the main reason for this rally is the investor perception that Ola Electric can strengthen its market position in the future. The incentives received under the PLI scheme can have a positive impact on EBITDA levels.
