Shares of Ola Electric Mobility Ltd. dipped below the ₹100 mark on Monday, marking the first time the stock has breached this level since its debut on the stock market in August. This decline represents a continued downturn for the electric vehicle (EV) giant, as the stock has now dropped for the ninth time in the last 11 trading sessions.

With Monday's dip, the stock has tumbled a staggering 37% from its all-time high of ₹157.4, which it had reached shortly after its listing. This recent drop raises concerns about the company’s short-term performance and highlights the challenges Ola Electric faces in maintaining investor confidence.

Key Points to Note:

• Stock Performance:
  Ola Electric shares fell 3.1% to ₹99, slipping below the ₹100 mark for the first time since listing.

• Decline Since Peak:
  The stock has dropped a total of 37% from its peak of ₹157.4, achieved just days after its market debut.

• Sales Decline:
  The company reported a 34% drop in sales for the month of August, raising concerns ahead of its September sales figures.

Strategic Moves by Ola Electric

To combat the declining momentum, Ola Electric recently launched its "Network Partner Program," a strategic initiative aimed at boosting EV adoption in Tier-2 and Tier-3 cities. The company has already onboarded 625 new partners as part of this plan, and it aims to increase this number to 1,000 by the upcoming festive season. This expansion is expected to improve its presence in semi-urban and rural markets.

Brokerage Insights

Despite the recent underperformance, brokerage firm HSBC has maintained its "buy" rating on Ola Electric. In a recent note, HSBC highlighted some key operational challenges, particularly with the company’s service centers, which are reportedly struggling to keep up with the rising demand for repairs and maintenance. The brokerage firm suggested that improving service quality is critical before the company launches its newly announced range of motorcycles, unveiled on August 15.

However, HSBC still holds a positive long-term outlook on the stock, with a price target of ₹140.

Leadership Commentary

Ola’s founder, Bhavish Aggarwal, recently commented in an interview that the company is focused on building a sustainable and profitable business, and is confident that its market share will improve as it ramps up operations and expands its reach into new markets.

Conclusion

The recent downturn in Ola Electric’s stock price is indicative of the broader challenges facing EV companies as they scale up their operations and service networks. The upcoming sales reports for September will be crucial in determining whether the company’s strategies are effective in reversing its sales decline and regaining market momentum.

Currently, Ola Electric shares are trading at ₹99, down 3.1% from the previous session. The stock was originally listed at an IPO price of ₹76 per share. Investors will be keenly watching the next few quarters to assess the impact of the company’s strategic moves on its financial performance and market valuation.