Ola Electric shares jump 17% on strong FY26 guidance, improved sequential performance in Q1

Mumbai, July 14, 2025 — Shares of Ola Electric Mobility Ltd surged 17% in Monday’s trade following the company’s robust first-quarter performance and a confident financial guidance for FY26, signaling growing investor optimism in India’s burgeoning electric vehicle (EV) sector.

The rally came after Ola Electric reported significant operational improvements and laid out a bullish roadmap for future growth, underscoring its transition from a loss-heavy startup to a maturing, scale-driven EV manufacturer.

Q1 FY26 Performance: Efficiency Gains and Narrowing Losses

In its earnings update for the quarter ending June 30, 2025, Ola Electric announced a 42% year-on-year increase in revenue, driven by higher deliveries of its S1 scooter lineup and strong traction from its recently launched S1 X+ and S1 Air variants.

More notably, operating losses narrowed significantly, down 38% from the previous quarter, as the company optimized manufacturing costs at its Tamil Nadu-based FutureFactory and achieved better economies of scale.

“We are pleased with our sequential improvements, especially on unit economics and customer acquisition metrics,” said Bhavish Aggarwal, Founder & CEO of Ola Electric. “With production efficiencies and strong demand tailwinds, we are entering a new growth phase in FY26.”

The company shipped over 1.15 lakh scooters in Q1 FY26, a 27% rise over Q4 FY25, and has also begun pilot production of its electric motorcycles set for launch in early 2026.

FY26 Guidance: Profitability, Export Push, and IPO Roadmap

Ola Electric offered a bullish FY26 revenue guidance of ₹15,000 crore, representing over 65% growth from the previous fiscal. The company also reiterated its goal of achieving EBITDA breakeven by the end of the fiscal, a key milestone as it prepares for its much-anticipated IPO.

Among its key growth drivers for FY26:

• Expansion of direct-to-consumer Experience Centers to over 1,000 locations

• Increased penetration into Tier-2 and Tier-3 cities

• Export initiatives targeting markets in Southeast Asia and Europe

• Introduction of battery subscription models and upgraded software features

“Ola Electric’s clear roadmap toward breakeven and strategic clarity in scaling operations is what the market was waiting for,” said Ruchir Nair, EV analyst at Axis Securities. “It’s still a capital-intensive play, but its trajectory is far more credible today than it was a year ago.”

Market Reaction: Investor Sentiment Turns Positive

The stock, which had underperformed since its debut in January, surged over 17% intraday to close at ₹274.60, its highest level since early April. Trading volumes were significantly higher, indicating renewed institutional interest.

Ola Electric’s market capitalization now stands at ₹93,000 crore, up nearly ₹14,000 crore in a single day. Analysts attribute the sharp reaction to a combination of stronger-than-expected numbers and management’s proactive investor engagement over the past quarter.

“The EV narrative in India has always had promise but lacked execution. Ola Electric is now showing signs of bridging that gap,” said Mitali Bhosale, fund manager at a Mumbai-based ESG-focused mutual fund.

Competitive Landscape: Ola Gains Amidst Fragmentation

Ola’s gains come at a time when the Indian EV two-wheeler market is experiencing fragmentation. Rivals like Ather Energy, TVS iQube, and Bajaj Chetak have reported mixed volumes in recent quarters amid FAME-II subsidy rollbacks and consumer price sensitivity.

However, Ola Electric has managed to offset subsidy cuts with aggressive pricing strategies and in-house battery production, helping it maintain price leadership.

Moreover, its vertically integrated model — from battery packs to software — is increasingly being seen as a competitive moat.

“Ola’s ability to control its supply chain and pricing gives it a margin advantage. This makes it one of the few Indian EV players with a shot at global competitiveness,” said Karan Mittal, senior analyst at Bernstein India.

Investor Outlook: IPO Anticipation and Valuation Re-Rating

With its IPO tentatively slated for early 2026, Monday’s stock movement is seen by many as a pre-IPO re-rating, based on improved fundamentals. Analysts expect the company to update its DRHP (Draft Red Herring Prospectus) with revised earnings estimates, potentially attracting long-term institutional investors.

Brokerage firms are now reviewing their target prices. JM Financial has raised its 12-month target on Ola Electric from ₹240 to ₹305, citing improved operating leverage and visibility into cash flows.

Still, risks remain. Key concerns include raw material inflation, potential regulatory changes in EV policies, and rising competition in the electric two-wheeler space.

A Turning Point for India’s EV Giant?

Ola Electric’s Q1 performance and FY26 guidance mark a potential inflection point. Once criticized for aggressive timelines and operational inconsistencies, the company is now steadily winning back investor trust with measurable progress and a more grounded vision.

If it can sustain this momentum through FY26 while successfully navigating its IPO, Ola Electric could emerge not just as India’s EV poster child, but as a serious global contender in the electric mobility space.