Ola Electric Shares Slide As Much As 7.6%
Shares of electric two-wheeler maker Ola Electric fell as much as 7.6% to an intraday low of about ₹29 on the BSE on October 23, after Goldman Sachs downgraded its outlook on the company to “Sell”. The brokerage also cut its price target to ₹23.
The move came a day after Ola Electric opened its ₹1,000 Cr rights issue for bidding. Within hours, Motilal Oswal and Calliope Capital Advisors applied for a combined 2.39 Cr shares against entitlements transferred by promoter group entities ANI Technologies and Indus Trust. Founder and CMD Bhavish Aggarwal pledged a 4.32% stake to fund his participation in the issue.
Ola Electric plans to use the rights issue proceeds primarily to reduce debt and fund business expansion.
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Why Ola Electric shares fell
Goldman Sachs said Ola Electric faces a challenging path to becoming cash flow positive because of relatively high interest costs and the capital expenditure needs of its cell and electric two-wheeler businesses. The brokerage also cut its top-line growth projections by up to 10% for FY27 to FY29.
Ola Electric has earmarked ₹350 Cr of the rights issue proceeds for repayment or prepayment of borrowings, including accrued interest and applicable penalties. Another ₹400 Cr is allocated to organic growth across its electric mobility and energy storage businesses.
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