Ola Electric shares fall 6% after Q2 results: Goldman Sachs says 'SELL'! Why does it see 37% downside?

Shares of Ola Electric Mobility declined on Friday, November 13, after the electric two-wheeler maker reported its September quarter results, with investors assessing the company's falling revenue, continued losses and challenges in its business transition.

Ola Electric shares fell as much as 6.32 per cent during the session to an intraday low of Rs 33.48, compared with the previous closing price of Rs 35.74. At around 10:31 am, the stock was trading at Rs 34.80, down Rs 0.94 or 2.63 per cent on the NSE.

The decline came even as the company's consolidated net loss narrowed on a year-on-year basis. However, a sharp fall in revenue and concerns over its dealer-led distribution strategy continued to weigh on the company's outlook.

Goldman Sachs has maintained its bearish stance on the stock and reduced its target price. Here is what investors need to know.

Ola Electric Q2 Results: Net loss narrows, revenue declines 39%

Ola Electric reported a consolidated net loss of Rs 362 crore for the July-September quarter of FY27, compared with a net loss of Rs 418 crore in the corresponding quarter of the previous financial year.

While the company's net loss narrowed by around 13.4 per cent year-on-year, its revenue from operations declined sharply.

Revenue fell nearly 39 per cent to Rs 421 crore in Q2 FY27 from Rs 690 crore in the year-ago period.

The company's total expenses also declined during the quarter. Expenses stood at Rs 639 crore, down 28 per cent from Rs 893 crore in the corresponding period last year.

The financial performance indicates that although Ola Electric has managed to reduce its losses and expenses, the decline in revenue remains a key concern.

Automotive and cell segments: What happened in Q2?

Ola Electric's automotive segment reported a loss of Rs 214 crore in the September quarter, compared with Rs 233 crore in Q2 FY26.

However, revenue from the automotive segment declined to Rs 420 crore from Rs 688 crore in the year-ago quarter.

The company's cell segment also continued to report losses. The segment posted a net loss of Rs 84 crore in Q2 FY27, compared with Rs 79 crore in the corresponding quarter last year.

Revenue from the cell segment stood at Rs 3 crore against Rs 4 crore a year ago.

In its shareholder letter, Ola Electric said it had achieved the scheduled commercial operation date (SCOD) for 6 GWh of cell manufacturing capacity ahead of schedule.

The company is now ramping up production and improving yields. It also said the government had extended its Advanced Chemistry Cell (ACC) Production Linked Incentive (PLI) scheme support until calendar year 2031.

Ola Electric expects PLI incentives to start coming in from the next quarter, as it is already ahead of its PLI milestones.

Dealer-led distribution strategy: Ola Electric targets 700 outlets

Another important development for Ola Electric is its ongoing restructuring of the retail distribution network.

The company is transitioning from company-owned stores to a dealer-led distribution model. It opened its first dealer store on September 4 and had expanded its network to 319 outlets by November 8.

The company aims to establish 700 outlets by the fourth quarter of FY27.

Ola Electric expects the transition to help reduce its operating expenses. In its shareholder letter, the company said operating expenses would further decline by around Rs 50 crore as it shuts down its company-owned store network.

However, the transition also comes with execution risks, particularly regarding the company's ability to maintain sales volumes and profitability through the dealer-led model.

Goldman Sachs on Ola Electric: Sell rating maintained, target cut to Rs 22

Global brokerage Goldman Sachs maintained its 'Sell' rating on Ola Electric shares and reduced its target price to Rs 22 from Rs 23.

The brokerage highlighted risks associated with the company's transition to a dealer-led distribution model.

Goldman Sachs expects gross margin pressure of more than 650 basis points due to the distribution transition. However, it believes some of this pressure could be offset by fixed-cost savings of around Rs 500 million.

The brokerage also reduced its FY27-FY29 revenue estimates by up to 6 per cent, citing weak volumes and continued losses.

The reduction in the target price indicates that Goldman Sachs remains cautious about the company's near-term business prospects despite its efforts to reduce operating expenses.

Ola Electric Share Price Target: 37% downside from current levels?

Goldman Sachs' revised target price of Rs 22 suggests further downside for Ola Electric shares from their current market price. At Rs 34.80, the stock is trading around 58 per cent above the brokerage's revised target price.

At the current market price of Rs 34.80, Goldman Sachs' target of Rs 22 implies a potential downside of approximately 36.8 per cent.

The brokerage has reduced its target price by Rs 1, or around 4.35 per cent, from its earlier target of Rs 23.

From a market performance perspective, Ola Electric shares have delivered negative returns across several periods. The stock has declined 0.83 per cent over one month, 7.22 per cent year-to-date and 17.51 per cent over one year.

In comparison, the Nifty 500 has gained 7.85 per cent over one month and has declined just 0.36 per cent year-to-date. Over one year, the index has remained almost unchanged, with a marginal gain of 0.04 per cent.

Ola Electric shares have a 52-week high of Rs 49.05, recorded on June 9, 2026, and a 52-week low of Rs 22.25, recorded on March 16, 2026.

The company's total market capitalisation stood at Rs 16,046.69 crore.