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Mint
15-07-2025
- Automotive
- Mint
Ola Electric share price extends rally, zooms 22% in two days despite ₹428 crore loss in Q1. What's behind the surge?
Ola Electric shares extended their winning streak to the second straight session on Tuesday, July 15, even as the company reported a net loss of ₹ 428 crore in the first quarter of the financial year 2025-26 (Q1FY26). However, the loss narrowed sequentially, which cheered stock market investors. Apart from this, many operating performance updates — improvement in margins to the auto segment, turning EBITDA positive in June —appeared to be driving the interest in the two-wheeler electric company's stock. Ola Electric shares, which are down almost 69% from their 52-week high levels, witnessed a spurt in buying interest as investors cheered the improvement in Q1FY26 performance over Q4FY25. The loss narrowed from ₹ 870 crore posted in the preceding quarter, even as it widened on a YoY basis. The consolidated revenue from operations stood at ₹ 828 crore during the June quarter, higher than ₹ 611 crore in the March quarter. 'What sparked investor interest was the sequential improvement—losses narrowed significantly from ₹ 870 crore in Q4 FY25—and the operational turnaround in the automotive segment. Notably, the unit achieved positive EBITDA in June and delivered a record gross margin of 25.6%, driven by vertical integration, disciplined cost control under Project 'Lakshya,' and the shift to more efficient Gen‑3 models,' said Harshal Dasani, Business Head, INVasset PMS. 'Market confidence was further bolstered by Ola's guidance for FY26, with projected gross margins of 35–40%, supported by PLI-linked incentives and a target of becoming EBITDA-positive from Q2 onward. The company also introduced rare-earth-free motors, addressing long-term supply chain concerns and adding credibility to its localisation roadmap," Dasani added. Ola expects to sell between 3,25,000 to 3,75,000 vehicles and generate revenue of ₹ 4200 - ₹ 4700 crore in FY26. With Production Linked Incentive (PLI) benefits beginning from Q2 for the Gen 3 product portfolio, gross margin is projected to rise to 35% - 40%, and the company anticipates full-year auto EBITDA of above 5%, the company said in a release post Q1 results. While the headline loss paints a grim picture, the underlying operational metrics indicate a company steadily regaining control and positioning itself for sustainable profitability, he said, adding that this is a classic case of the market rewarding execution clarity over immediate bottom-line performance. Ola Electric share price settled over 18% higher on the BSE following its Q1 results announcement earlier in the day. In intraday today, Ola Electric share price jumped almost 4% to ₹ 48.88, taking the two-day gains to 22%. Global brokerage Goldman Sachs maintained a 'Buy' rating on Ola Electric stock and raised the target price to ₹ 63 from ₹ 60 earlier. HSBC also raised its target for Ola Electric share price to ₹ 49 while maintaining a 'Hold' rating. After multiple misses, punchy gross margin expansion in 1Q was a positive surprise, said HSBC. Yet it remains concerned that the cell business might not be eligible for the PLI benefit, weighing down the company's longer-term margin. However, Kotak Institutional Equities (KIE) retained its 'Sell' rating on Ola Electric stock. "While the company has improved its profitability significantly, volume offtake remains below expectations given muted industry growth and increased competitive intensity, which remains an area of concern. Maintain SELL with an unchanged FV of ₹ 30 based on DCF methodology (3.5X FY2027E EV/sales)," it said.
Time of India
14-07-2025
- Automotive
- Time of India
Ola Electric shares surge over 9% despite posting Rs 428 crore loss in Q1. Here's why
Ola Electric 's shares climbed as much as 9.5% on Monday to Rs 43.60 on the BSE, even as the company reported a wider consolidated net loss of Rs 428 crore for the quarter ended June 2025. The rally surprised many at first glance, but behind the headline loss, the company delivered a series of operational wins that signalled a possible inflection point in its journey to profitability. Despite the year-on-year drop in revenue, down 49.6% to Rs 828 crore from Rs 1,644 crore, Ola met its top-line guidance and reported a sequential growth of over 35% from Rs 611 crore in the March quarter. Most notably, the company's auto segment turned EBITDA positive in June, a first for the EV maker. by Taboola by Taboola Sponsored Links Sponsored Links Promoted Links Promoted Links You May Like Join new Free to Play WWII MMO War Thunder War Thunder Play Now Gross margin for the quarter stood at 25.6%, its best so far, even though key models are yet to receive government certification required to unlock PLI-linked incentives. Ola credited the improvement to reduced bill-of-materials costs and efficiencies driven by vertical integration and proprietary technology. Demand for its Gen 3 scooters, Roadster bikes, and the high-margin MoveOS+ software also contributed to the better-than-expected margin performance. Costs cut sharply, breakeven in sight Live Events Ola's cost-cutting programme, Lakshya, helped slash auto operating expenses to Rs 105 crore per month, down from Rs 178 crore in Q3 FY25. Consolidated opex is now around Rs 150 crore monthly, and the company expects to hold this line even if volumes double by the end of FY26. Total expenses in Q1 fell 42.4% year-on-year to Rs 1,065 crore. As a result, while consolidated EBITDA remained in the red at Rs 237 crore, the margin improved to -28.6%, from -113.9% in the previous quarter. Auto EBITDA narrowed to -11.6%. Guidance holds firm, cash runway intact The company reaffirmed its FY26 targets: sales of 3.25–3.75 lakh vehicles and revenue between Rs 4,200 crore and Rs 4,700 crore. Ola said it expects auto EBITDA to remain positive from Q2 onward and rise above 5% for the full year. Ola projected Rs 300 crore in auto capex for the remainder of FY26 and estimates that Rs 400–500 crore in additional funding will be needed to bridge to free cash flow breakeven by year-end. For its battery cell business, the 5 GWh installation is on track for completion this year, with 70% of the Rs 1,000 crore investment covered by existing term loans. FCF breakeven for the cell unit is expected by end-FY27. The company ended June with a cash balance of Rs 3,197 crore and said it does not foresee any further funding requirements for ongoing operations. Debt refinancing talks are underway and expected to close in the next quarter. Investor optimism builds, but risks remain While the turnaround signals are encouraging, Ola acknowledged macro uncertainties, including supply chain risks and growing competition, that could impact execution in the coming quarters. Still, with margins improving, cash burn narrowing, and demand holding steady, the stock's rally suggests investors are beginning to price in a credible shift toward profitability. Whether the company can sustain this momentum remains the key question. Also read | Ola Electric Q1 Results: Net loss widens 23% YoY to Rs 428 crore, revenue drops 50% ( Disclaimer : Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of the Economic Times)
Economic Times
14-07-2025
- Automotive
- Economic Times
Ola Electric shares surge over 9% despite posting Rs 428 crore loss in Q1. Here's why
Ola Electric's shares climbed as much as 9.5% on Monday to Rs 43.60 on the BSE, even as the company reported a wider consolidated net loss of Rs 428 crore for the quarter ended June 2025. The rally surprised many at first glance, but behind the headline loss, the company delivered a series of operational wins that signalled a possible inflection point in its journey to profitability. ADVERTISEMENT Despite the year-on-year drop in revenue, down 49.6% to Rs 828 crore from Rs 1,644 crore, Ola met its top-line guidance and reported a sequential growth of over 35% from Rs 611 crore in the March quarter. Most notably, the company's auto segment turned EBITDA positive in June, a first for the EV maker. Gross margin for the quarter stood at 25.6%, its best so far, even though key models are yet to receive government certification required to unlock PLI-linked incentives. Ola credited the improvement to reduced bill-of-materials costs and efficiencies driven by vertical integration and proprietary technology. Demand for its Gen 3 scooters, Roadster bikes, and the high-margin MoveOS+ software also contributed to the better-than-expected margin cost-cutting programme, Lakshya, helped slash auto operating expenses to Rs 105 crore per month, down from Rs 178 crore in Q3 FY25. Consolidated opex is now around Rs 150 crore monthly, and the company expects to hold this line even if volumes double by the end of FY26. ADVERTISEMENT Total expenses in Q1 fell 42.4% year-on-year to Rs 1,065 crore. As a result, while consolidated EBITDA remained in the red at Rs 237 crore, the margin improved to -28.6%, from -113.9% in the previous quarter. Auto EBITDA narrowed to -11.6%.The company reaffirmed its FY26 targets: sales of 3.25–3.75 lakh vehicles and revenue between Rs 4,200 crore and Rs 4,700 crore. Ola said it expects auto EBITDA to remain positive from Q2 onward and rise above 5% for the full year. ADVERTISEMENT Ola projected Rs 300 crore in auto capex for the remainder of FY26 and estimates that Rs 400–500 crore in additional funding will be needed to bridge to free cash flow breakeven by its battery cell business, the 5 GWh installation is on track for completion this year, with 70% of the Rs 1,000 crore investment covered by existing term loans. FCF breakeven for the cell unit is expected by end-FY27. ADVERTISEMENT The company ended June with a cash balance of Rs 3,197 crore and said it does not foresee any further funding requirements for ongoing operations. Debt refinancing talks are underway and expected to close in the next the turnaround signals are encouraging, Ola acknowledged macro uncertainties, including supply chain risks and growing competition, that could impact execution in the coming quarters. ADVERTISEMENT Still, with margins improving, cash burn narrowing, and demand holding steady, the stock's rally suggests investors are beginning to price in a credible shift toward profitability. Whether the company can sustain this momentum remains the key question. Also read | Ola Electric Q1 Results: Net loss widens 23% YoY to Rs 428 crore, revenue drops 50% (Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of the Economic Times) (You can now subscribe to our ETMarkets WhatsApp channel)
Business Upturn
02-05-2025
- Business
- Business Upturn
Sona BLW Q4 Results: Citi raises target price for stock as PLI boosted earnings but cuts growth estimates
Citi has reiterated its 'Buy' rating on Sona BLW, while raising the target price to ₹590 from ₹570, after the company's Q4FY25 earnings exceeded estimates, helped by PLI-linked incentives. By Markets Desk Published on May 2, 2025, 08:25 IST Last updated May 2, 2025, 08:15 IST Citi has reiterated its 'Buy' rating on Sona BLW, while raising the target price to ₹590 from ₹570, after the company's Q4FY25 earnings exceeded estimates, helped by PLI-linked incentives and higher-than-expected other income. Sona BLW reported a YoY net profit of ₹164 crore, up 1.3%, and revenue of ₹868 crore, down 2%. EBITDA fell 5% to ₹235 crore, with margins at 27.1%, compared to 28% in Q4FY24. Notably, other income surged to ₹52 crore from ₹7 crore, aiding the bottom line. Citi noted that the outlook remains positive despite global risks, including the recently announced US tariff hikes. The brokerage estimates that only 3% of total revenue is exposed to the US tariffs, which it views as manageable. However, Citi flagged volatility in near-term demand and potential disruptions in the supply chain for rare-earth metals used in EV powertrains. It has trimmed FY26–27 estimates slightly to account for these uncertainties, but continues to see strong fundamentals driving long-term growth. Disclaimer: The above views are those of the brokerage and not the publication. Investors are advised to consult a certified financial advisor before making investment decisions. Markets Desk at
