Ola Electric Rallies 16%: What’s Fueling The Sharp Surge?

Shares of Ola Electric Mobility surged more than 16% today, despite the rest of the market underperforming. Until midday, over 500 million shares were traded. The stock is continuing its upward trend from yesterday’s session, with its two-day increase now surpassing the 20% mark.

Ola Electric Mobility shares opened at ₹30.50 and quickly moved higher, touching an intraday peak of ₹35.30. By around 12:10 PM, it was trading near ₹35.16 on the NSE, holding on to most of its gains.

Why Are Ola Electric Shares Suddenly Moving Up?

The trigger appears to be a fresh update on the company’s battery technology. Ola Electric recently said its in-house Lithium Iron Phosphate or LFP cell is now ready. This matters because battery costs make up a large part of EV pricing.

The new 46100 format cell is larger than its earlier cell version and is designed to bring down costs while improving efficiency. The company plans to start using these cells in its vehicles from the next quarter.

This step is also part of a bigger strategy. Ola is trying to control more of its supply chain by making key components on its own. If executed well, this could help margins and reduce dependence on imports over time.

Alongside this, the company is expanding its Gigafactory. The capacity currently stands at 2.5 GWh and is being scaled up to 6 GWh. That gives a sense of how aggressively it is investing in future demand.

Signs Of Recovery Or Just A Short-Term Bounce?

The recent rally comes after a steep fall earlier this year. From its March low of ₹21.21, the stock has now climbed by over 50%. Even so, it remains far below its 52-week high of ₹71.24.

There are some early signs that things may be improving. Vehicle registrations picked up in March, and the company has been working to fix service-related complaints. Faster servicing and better parts availability seem to be helping customer experience.

Analysts tracking the stock say the tone has turned cautiously positive. They point to tighter execution and better operational discipline in recent months. Some also see the company’s push into products like inverters as an additional growth lever once delays are sorted out.

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What Should Investors Watch From Here?

On the charts, the stock has crossed the ₹34 level, which was acting as a resistance point. The next zone traders are watching lies around ₹40 to ₹41.

However, there is cause for concern regarding how fast the stock has been increasing. The Relative Strength Index at 73 has entered overbought territory, signalling that the stock may see temporary halts or pullbacks soon.

For now, the story seems to be shifting from concern to cautious optimism. But the bigger test lies ahead. Can Ola Electric sustain demand, execute on its battery plans, and keep improving operations quarter after quarter?

Sources:

Business Standard

Mint

Moneycontrol