Ola Electric’s shares have seen a dramatic plunge, crashing 52.5% from their peak, falling below the issue price of ₹76. This downturn marks a stark contrast to its early performance since debuting on the stock exchanges last month.
| Table of Contents |
|---|
| Stock Performance |
| IPO Details |
| Utilization of IPO Proceeds |
| Analyst Views |
| FAQ |
Stock Performance
Ola Electric debuted on the bourses on August 9, 2024, with a listing price of ₹75.99 on the BSE and ₹76 on the NSE. Following a muted listing, the stock rallied spectacularly, gaining over 107% to reach a peak of ₹157.53 on August 20, 2024. However, it has since entered a downward trend, hitting a new low of ₹74.82, falling below the issue price for the first time since its launch.
IPO Details
The IPO of Ola Electric was valued at ₹6,145.56 crore and was open for subscription from August 2 to August 6, 2024. The IPO price range was set at ₹72-76 per share. Demand for the public offering was strong, with bids totaling 4.45 times the shares available for investment. In terms of subscription rates, the retail investor segment saw a robust subscription of 4.05 times, while non-institutional investors (NII) and qualified institutional buyers (QIB) were subscribed 2.51 and 5.53 times, respectively.
Utilization of IPO Proceeds
Ola Electric plans to utilize the proceeds from their IPO for several strategic initiatives, which include expanding their cell manufacturing plant capacity and repaying outstanding debt. The book-running lead managers for the Ola Electric IPO included reputed firms such as Kotak Mahindra Capital Company Limited, BofA Securities India Limited, Axis Capital Limited, and SBI Capital Markets Limited.
Analyst Views
Brokerages provide mixed opinions on Ola Electric’s stock performance. Kotak Institutional Equities views the stock as well-positioned to capitalize on the growing electric vehicle (EV) market. Conversely, HSBC has revised its target price downward, citing concerns about market penetration and various service-related issues as potential hindrances to growth.
FAQ
Q1: Why has Ola Electric’s stock dropped significantly?
A1: The stock has experienced a downward trend following initial high performance, attributed to various market factors, including concerns over market penetration and service issues, as highlighted by analysts.
Q2: What was the issue price of Ola Electric’s IPO?
A2: The issue price of Ola Electric’s IPO was set at ₹76 per share.
Q3: How was the demand for Ola Electric’s IPO?
A3: The IPO was well-received, with total bids amounting to 4.45 times the shares available for subscription.
