Ola Electric shares fall 2% as Citi slashes target price by over 18%. Here’s why brokerage is bearish

Shares of pure-play EV major Ola Electric Mobility dropped as much as 2% to their day's low of Rs 23.83 on the BSE on Tuesday after Citi Research slashed the target price to Rs 22, marking a decrease of 18.5% from the previous price of Rs 27.

With the new target price, the international brokerage suggests a downside potential of 9.5% from current market levels. Analysts cited downward revisions in revenue estimates and continued market share pressures. The brokerage has trimmed its FY26-FY28 revenue forecasts by 5% to 14%, reflecting weaker volume expectations amid the company’s ongoing loss of market share.

Citi has maintained its valuation at 3.5x FY27E EV/Sales but lowered the target price following the earnings revisions. The brokerage noted that Ola Electric is unlikely to achieve EBITDA break-even even by FY28.


The 3.5x EV/Sales multiple represents about a 10% discount to listed two-wheeler OEM peers, which Citi attributes to the company’s market share loss, slower-than-expected EV adoption and weak cash generation.

However, the brokerage added that an EBITDA turnaround could be possible if volumes improve. Additional revenue opportunities from battery energy storage systems (BESS), along with improved product and service quality perception, could also support performance over time.

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Ola Electric Mobility share price has seen a sharp fall of 84.5% from its record peak of Rs 157. The stock had surged to that level in a post-listing frenzy after debuting at an issue price of Rs 76 in 2024. What stands out is the speed of the reversal, in less than two years since listing on Dalal Street.

Last month, international brokerage Goldman Sachs downgraded Ola Electric to Neutral and cut its target price to Rs 26 from Rs 52. The brokerage has lowered its FY26 to FY28 revenue estimates and now factors in a mid single-digit market share for FY30E and beyond, compared with its earlier expectation of market share in the low teens.

It expects that at the revised pace of EBITDA losses and capital expenditure, the company’s cash burn could necessitate a fund raise over the next 12 to 18 months.

According to the Vahan website, Ola Electric's market share in the electric two-wheeler segment fell to 6.3% in January from about 26% a year ago. In the first 18 days of February, the company sold 2,575 vehicles, further reducing its market share to about 4.2%.

Ola Electric, which was the market leader in the segment last year, currently trails behind legacy companies such as TVS Motor, Bajaj Auto and Hero MotoCorp, as well as new-age players like Ather Energy.

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