India's Ola Electric surges 20% on debut on EV optimism

STORY: Shares in Ola Electric surged during the company’s trading debut in Mumbai on Friday (August 9) - valuing the company at $4.8 billion.

That’s as investors bet on greater adoption of electric vehicles in India, the world’s largest market for two-wheelers.

Ola Electric's $734 million IPO is India's biggest so far in 2024.

And the adoption of EVs in India is still low but it’s rising as Prime Minister Narendra Modi's government promotes clean energy.

Ola Electric dominates sales of electric scooters in India, having launched its first model just three years ago.

As of July, it had 39% market share.

Analysts said investors were also optimistic about Ola Electric's foray into motorcycles.

The company is expected to launch its range of electric models next week.

However, while Ola's revenues have soared, it has yet to turn a profit.

In the year to the end of March, the company's sales rose 90% year-on-year, but losses widened 8%.

The company plans to invest its IPO proceeds into manufacturing its own battery cells.

It has pinned its profitability on this, as manufacturing their own battery cells should make their scooters more affordable.