Shares of EV two-wheeler major Ola Electric Mobility slipped as much as 5% to hit their all-time low of Rs 27.36 on the BSE on Tuesday after international brokerage Citi downgraded Ola Electric to “Sell” from “Buy”. The brokerage slashed the stock’s target price by 51% to Rs 27 from Rs 55, citing persistent headwinds to volume growth, reported ET Now. The stock is down 14% in the last 4 sessions.

The brokerage noted that EV penetration in India’s two-wheeler segment has been more sluggish than anticipated, with GST cuts further slowing the pace of electrification. Citi highlighted that Ola Electric has lost market share amid service-related challenges, intense competition and adverse customer perception.

The company’s Q3 results came in below estimates, largely due to negative operating leverage. While the brokerage acknowledged the improvement in gross margins and said better operating leverage could support EBITDA going forward, it cautioned that management’s efforts to enhance product and service quality may take time to yield results. Additionally, sustained negative cash flows could raise investor concerns around the balance sheet and rising net debt levels.

Ola Electric Q3 results

The electric two-wheeler maker posted a net loss of Rs 487 crore in Q3 FY26, compared with Rs 564 crore in the corresponding quarter last fiscal.

However, revenue from operations dropped 55% year-on-year to Rs 470 crore, reflecting slower growth in EV penetration and lower volumes. Adjusted operating EBITDA losses also improved significantly, narrowing to Rs 323 crore in the third quarter from Rs 494 crore a year ago.

In its Shareholders’ Letter for Q3 FY26, Ola Electric described the quarter as a “structural reset.” The company said it has realigned its retail footprint, cost structure, and operating model to focus on strengthening fundamentals rather than chasing short-term volumes. This recalibration, management noted, has resulted in a structurally lower volume breakeven point and improved operating leverage.

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During the quarter, the company reported a record consolidated gross margin of 34.3%, expanding 15.7 percentage points year-on-year and 3.4 percentage points sequentially. The margin improvement was attributed to vertical integration, Gen3 platform economics, and tighter cost discipline. The company reiterated its guidance of achieving gross margins in the 35–40% range in FY27.

Ola Electric shares are down over 20% since the beginning of the year.

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