Ola Electric Shares fell 3.5% in trading hours on Tuesday, falling below the IPO price of Rs 76 for the first time since its listing on August 9. The stock touched an intraday low of Rs 74.84 on NSE before closing at Rs 76.64. At the same time, the stock has fallen 23% in the last one month. Let us tell you that Ola Electric Mobility had a cold start in the market, it was listed at the upper band of the issue price at Rs 76. However, the stock soon bounced back, touching the 20% upper circuit in the following days and hitting a record high of Rs 157.40 on August 20. However, after that the share price fell drastically. The reason for this was many negative news regarding poor service from the company. On Tuesday, the market capitalization of the company has declined from Rs 69,000 crore to Rs 33,804.60 in two months.
HSBC had earlier cut the target price
On Ola Electric, global broking firm HSBC has first reduced the target of share price of Ola Electric from Rs 140 to Rs 110. At the same time, Kotak Institutional Equities believes that Ola Electric is well positioned to take advantage of the EV growth opportunity given the growing trend of EV adoption in two-wheelers, focus on EV-only models and end-to-end mobility. End is driven by integration, which will support margin growth. This integration allows the company to pursue aggressive pricing strategies, which can help it scale operations faster. Despite this, Kotak considered the stock to be fairly valued given concerns over potential market share loss due to competition and service quality issues. The brokerage gave 'Reduce' rating to the stock with a target price of ₹80, higher than its current trading price.
Now what next?
Market experts say that the Indian stock market is currently in a down trend. Due to this, selling is being seen in stocks of all sectors. Auto stocks are getting hit hard. This includes stocks of big companies like Maruti, Tata, Mahindra, Bajaj, Hero. Its effect can also be seen on Ola's stocks. Stocks may fall further in the coming days. Therefore investors still need to invest in this stock with caution.
Image Credit: India-Tv.