Ola Electric stock surges nearly 5% today: Here's why
What's the story
Ola Electric's shares surged by up to 4.7% on the BSE today, following reports of a high-level meeting convened by Niti Aayog. The meeting is set to include leading two-wheeler manufacturers such as Hero MotoCorp, Bajaj Auto, TVS Motor Company, Ola Electric itself, Ather Energy, and Revolt Motors. The main agenda is to accelerate the adoption of electric motorcycles in India.
Market analysis
Electric motorcycles crucial for achieving overall 2-wheeler electrification targets
While electric scooters already account for nearly 15% of their segment, motorcycles—two-thirds of India's two-wheeler market—have just 0.1% penetration. This poses a major challenge to the government's broader electrification goals. According to government projections, electric scooters could account for 80% of sales by 2030, while electric motorcycles may only capture about 10%. Together, that would bring overall two-wheeler electrification to around 36%, far below policy targets unless motorcycles accelerate their transition.
Meeting agenda
Discussions to likely cover cost reduction, financing, and battery swapping
The upcoming discussions are likely to focus on reducing costs, innovative financing models, and battery swapping. These are all aimed at tackling high upfront prices, the biggest hurdle for electric motorcycles. Unlike scooters that benefitted from China's models and supply chains, electric motorcycles don't have such a foundation. This has forced Indian companies to start from scratch in this segment.
Financial outlook
Ola Electric's improving margins and narrowing losses boost investor sentiment
In the June quarter, Ola Electric narrowed its losses and improved gross margins by 11% QoQ to 26% by June-end. The company expects its auto business to become EBITDA positive in Q2 and has guided for gross margins of 35-40% for FY26. Anirudh Garg, Partner & Fund Manager at INVasset PMS, said investors seem more interested in Ola's execution and long-term growth than short-term volatility.