Ola Electric shares fall 8% as SoftBank reduces stake
What's the story
Ola Electric Mobility's shares plummeted nearly 8% on Friday, after SoftBank sold a 2% stake in the company through open market transactions. The sale was conducted by SoftBank's investment arm SVF II Ostrich (DE) LLC between July 15 and September 2. The transaction exceeded the 2% threshold for disclosure under SEBI's takeover regulations, according to a regulatory filing.
Stake reduction
SoftBank's stake reduced to 15.68%
Before the transaction, SoftBank held 786.6 million shares or 17.83% of Ola Electric's paid-up capital. After selling off 94.9 million shares, its stake has now been reduced to 691.6 million shares or 15.68%. Despite this reduction, SoftBank remains one of the largest institutional shareholders in Ola Electric after the latest stake dilution process.
Market response
Goldman Sachs raises price target to ₹72 per share
Despite the dip, Goldman Sachs has maintained its 'Buy' rating on Ola Electric shares and increased its price target to ₹72 per share. This suggests a potential upside of nearly 12% from the stock's previous closing price of ₹64.5 per share. Despite facing cooling demand and intensifying competition, Ola Electric has reclaimed the number two position, overtaking Bajaj Auto. The Bengaluru-based start-up sold 18,972 units in August but its sales were down 31% from a year earlier.