Ola Electric shares surge 16% after revenue jumps 32% YoY, motorcycle launch

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Shares of electric scooter maker Ola Electric surged 15.8% to a day’s high of Rs 128 on the BSE after the company announced a 32% YoY increase in revenue for the first quarter of FY25, reaching Rs 1,644 crore. The company also launched its electric motorcycle, the Roadster, on August 15.

Quarterly results


The company reported a year-on-year (YoY) revenue increase, but the quarterly loss widened to Rs 347 crore, up from Rs 267 crore in the same quarter of the previous year.

The firm's automotive division saw total income increase by 34% to Rs 1,722 crore, though the loss after tax widened to Rs 233 crore from Rs 189 crore a year ago. The battery division reported an income of Rs 5 crore for the quarter, with a loss after tax of Rs 37 crore.

Ola Electric's revenue increased from Rs 1,671 crore in the last quarter of FY24, and its net loss narrowed from Rs 416 crore reported for the quarter ended March 31, 2024.

Electric motorcycle launch


On August 15, the company announced the launch of its electric motorcycles and the integration of its cells in EVs by Q1 FY26.“Affirming its resolve to make India a global EV and new energy hub, Ola Electric today announced new products and future roadmap across EV and energy verticals. With the launch of Roadster, Roadster X, and Roadster Pro, the company today entered the electric motorcycle segment and further announced the integration of its cells in its own vehicles starting Q1 FY26. The company also showcased the indigenously developed Bharat 4680 cell and battery pack, new Gen-3 platform, and MoveOS 5 at Sankalp 2024 - Ola’s annual launch event at its Futurefactory in Krishnagiri, Tamil Nadu on August 15, 2024,” said the company in a filing to the exchanges.The company's Roadster portfolio includes the Roadster X, Roadster, and Roadster Pro, with prices starting at Rs 74,999, Rs 1,04,999, and Rs 1,99,999, respectively.

Additionally, the company has teased two new motorcycles: the Sportster and the Arrowhead.

“Today, 2/3rd of India’s 2W market consists of motorcycles, and with Ola’s entry into this segment, EV penetration is poised to further accelerate in the Indian 2W segment. We have already been successful in accelerating EV adoption in the scooter segment, and with our futuristic portfolio of products, we are now focused on supercharging EV penetration through our motorcycles. Coupled with the integration of our cells in our vehicles starting early next year, we are determined to chart a new course for mass EV adoption across India,” said Bhavish Aggarwal, Founder and CMD, Ola Electric on the launch of Ola’s electric motorcycles.

Brokerage view


HSBC has initiated a buy call on Ola Electric with a target price of Rs 140.

EV manufacturing costs are expected to fall significantly by FY27/28, while costs for ICE scooters may rise due to stricter emission standards. Barriers to switching to electric two-wheelers (e2Ws) may decrease, and Ola's battery venture could succeed. HSBC believes Ola is a strong investment due to sustained regulatory support, its potential to reduce costs, and a favorable risk-reward profile in its battery venture. However, slower adoption of e2Ws and potential battery plant issues are key downside risks.

Global brokerage firm Nomura noted that the motorcycle segment has been challenging for electrification, with past launches from companies like Tork, Revolt, and Ultraviolette not achieving significant success. Nomura estimates that EVs will capture a 25% share of the two-wheeler industry by FY30. With Ola offering multiple price points and range options, it will be interesting to see how customers respond to e-motorcycles.

(Disclaimer: Recommendations, suggestions, views, and opinions given by the experts are their own. These do not represent the views of The Economic Times)

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