Ola Electric shares have fallen 65% from all-time highs; here’s why

Ola Electric Mobility shares were in focus after the company announced that it had laid off 1,000 employees. The company's shares have seen a steep correction since touching record highs in August 2024. After a muted debut on the exchanges, the shares nearly doubled from the listing levels in just seven trading days. The shares were listed at ₹75.8 apiece on the NSE on 9 August 2024 and hit a record-high level of ₹157.4 apiece on 20th August 2024. On Tuesday, the company’s shares hit a new low of ₹53.6 apiece, dropping over 65% from the all-time highs.

Ola Electric shares are significantly underperforming their peers. For instance, TVS Motors' share price is down 29% from record-high levels, and Bajaj Auto is down 40% from record-high levels.

Poor fundamental performance

The electric two-wheeler (2W) manufacturer has seen a drastic drawdown in its financials despite having a decent market share in the electric 2W space. The company’s revenue for the quarter ended December 2024 declined 19% YoY and 13% QoQ to ₹1,045 crore. Despite strong sales growth, the company failed to deliver operational efficiencies and generate operational profit. As of Q3FY25, the company continues to operate at an operational loss of ₹460 crore. Consequently, the net loss for the quarter stood at ₹564 crore compared to ₹376 crore loss in Q3FY24.

Consistent decline in sales

Despite maintaining more than 25% market share in the e-2W space, the company has seen a sharp drawdown in vehicle sales in FY25. The company sold nearly 50,000 units in March 2024, and since then, the monthly sales figures have been on a declining path. The company sold 41,624 units in July 2024, followed by 24,665 units in September 2024 and 8,674 units in February 2025. The declining sales numbers cast a bleak outlook for the company’s investors.

Intense competition

The company faces intense competition from established peers who have a bigger network and better after-sales service as well. Moreover, they have consistently achieved better sales numbers than Ola in the previous year. Ola Electric witnessed a 74% YoY drop in sales for February as compared to an 81.8% gain by Bajaj Auto, a 52.4% gain by Hero MotoCorp, a 28% gain by TVS Motors, a 29% gain by Ather Energy and a 42.7% gain by Greaves Electric. The established and legacy players like Bajaj Auto, TVS Motors, and Hero MotoCorp sold nearly 43,000 vehicles, more than the new entrants like Ola Electric, Greaves Electric, and Ather Energy, which collectively sold nearly 24,200 units in February.

Apart from the above three key reasons, the company struggles with poor corporate governance issues, such as the CTO and CMO resigning within one year of listing. There is also high discontent among vehicle owners regarding after-sales service, which suggests a negative outlook for the company’s share price. The company also sacked nearly 1,000 employees, citing cost optimisation measures, which also indicates poor operational efficiency.

What lies ahead?

The company plans to expand its reach nationwide through its newly opened stores. In addition, it also aims to achieve 50,000 units of monthly sales to become EBITDA positive in coming quarters. Furthermore, the company will continue to face challenges in holding market share as peer competition intensifies.