Ola Electric Mobility, India’s leading e-scooter maker, surged 20% on August 16 to reach a valuation of 586.64 billion rupees ($6.99 billion).
The news comes on the verge of the company launching its new line of motorcycles and planning to use its own batteries to reduce costs.
OLA has launches three EV bikes in India.
With these launches at this price point OLA has democratized EV Market
Reservation starts today.#OLA #OlaSankalp2024 #Ebike @bhash
1X pic.twitter.com/zgpWqBZmIU— Amith Gowda (@amithv_gowda) August 15, 2024
Morgan Stanley said Ola Electric’s motorcycle line addresses the “mass and premium” sides of the segment, noting that its close pricing to traditional motorcycles is likely to intensify competition.
The launch of the company’s new e-motorcycles is set to heat competition in India. Ola Electric Mobility will compete with other companies such as Bajaj Auto, TVS Motor, and Hero Motocorp.
Ola Electric Mobility plans to develop an “all-important” battery and hopes to build most of its EV parts in India.
Ola Electric’s Financials
To recall, Ola Electric listed its shares on Aug. 9 after a $734 million initial public offering (IPO), which has seen its shares jump 75% over the launch price of 76 rupees.
It was valued at $5.4 billion in a September 2023 pre-IPO funding round. However, Ola Electric had slashed its valuation target to $4 billion for its IPO due to a correction in global tech companies and to attract participants to the stock offering.
HSBC has a “buy” rating on the shares and a price target of 140 rupees, citing regulatory support and the company’s ability to reduce costs.
On August 14, Ola Electric reported a wider first-quarter loss, hurt by subsidy cuts. On August 15, the company released a new series of e-motorcycles, expanding into an untapped segment. It plans to equip its vehicles with its own batteries by this time next year.
India is the world’s second-largest two-wheeler market, with 18 million units sold last year. EV adoption is rising in India, but slowly, due to concerns around vehicles’ range, lack of sufficient charging infrastructure, and a low re-sale value.