Ola Electric Shares Surge 8% To New Peak, Outpacing Tesla

Shares of Ola Electric soared by 8% on Tuesday, reaching a new high of Rs 157.53 on the BSE, surpassing even Tesla’s valuation. The electric vehicle stock has surged 107% from its IPO price of Rs 76 in just seven trading sessions. On Tuesday alone, 2.3 crore shares, representing 0.5% of the equity, were traded for Rs 352.9 crore at an average price of Rs 151 per share.

Despite the remarkable rise, concerns are mounting over Ola’s valuation, which now exceeds that of Tesla. Currently, Ola is valued at 7.8 times its sales, while Tesla stands at 6.8 times. Saji John, Senior Research Analyst at Geojit Financial Services, warned that while Ola’s long-term potential in the EV market may be promising, its current valuation seems speculative amid ongoing losses and stock volatility.

Dalal Street veteran Andrew Holland from Avendus Capital expressed uncertainty over the reasons behind the sharp price increase, questioning whether the IPO price was undervalued. Analysts suggest that new investors should either wait for a more stable entry point or consider the stock as a high-risk, high-reward long-term investment.

HSBC, the first brokerage to initiate coverage on Ola, set a target price of Rs 140 using a discounted cash flow method, with a 10.0% WACC and a 7.5% long-term growth rate. The bank emphasized four critical factors affecting Ola’s valuation: EV adoption in India, market share and competition, regulatory developments, and the success of its battery manufacturing unit. Despite a 32% increase in revenue for the June quarter, Ola’s losses widened to Rs 347 crore from Rs 267 crore the previous year. The company also expanded into electric motorcycles with new models and plans to integrate its cells into vehicles by Q1 FY26.