Ola Electric Shares Drop After Weak Q3 Earnings
Ola Electric faced its first major obstacle when its stock dropped 6 % on February 16 after the company released unsatisfactory third-quarter results. Investors who expected continuous growth saw their plans interrupted by an unexpected halt. The brokerage firm Emkay Global lost faith in the stock when it changed its rating from ‘buy’ to ‘sell’ while cutting its price target by 60 %, from ₹50 to ₹20.
The market currently questions whether the company will experience a short-term challenge or face a prolonged setback because its revenues have decreased by half and its high losses continue. Ola’s electric two-wheelers attract consumer interest, but the stock’s performance at launch time has disturbed initial investors from their slumber.
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Ola Electric Q3 Financial Performance Highlights: Ola Electric Share Price Impact
Ola Electric experienced a difficult third-quarter performance, which affected its electric two-wheeler production operations. The company faced major difficulties due to a revenue decline, which decreased by 55 % compared to the previous year and 32 % compared to the previous quarter. The company continued to report high losses, with a net loss of ₹490 crore compared to the previous quarter’s loss of ₹560 crore. It reported EBITDA losses of ₹271 crore, showing an annual decrease but a quarterly increase. Gross margins improved to 34.3% from 18.6% during the past year and 30.9% during the previous quarter, indicating better operational efficiency. The company encountered significant volume reductions, with a 61% annual drop and a 38% quarterly drop, reflecting both decreasing demand and operational execution challenges.
OLA Business Segment Revenue
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Auto business: ₹467 crore, down 55% from the previous year.
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Cell business: ₹9 crore, up from ₹3 crore year-on-year.
Ola Electric Share Price Slips Amid Turnaround Challenges and Rising Debt
Ola Electric is encountering significant difficulties as it works to improve its business operations while facing strong competition from Ather and other established companies.
Analysts believe that the recovery process will take considerable time, as the company’s net debt increased to ₹670 crore during the first three quarters of FY26, up from net cash of ₹160 crore in H1 FY26. The company could gain financial support through the sale of a strategic stake in its battery business, providing substantial cash resources. The stock price of Ola Electric fell 5.4% to ₹29.1 per share at market open on February 16, representing a 52.4% decline over the past year.
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