Ola Electric (OLAELEC)

FairStock Score: 22/100 — RISKY

Score breakdown: P/E: 0/3 · ROCE: 0/2 · Growth: 1/2 · Dividend: 0/1

Key Financials

AI Analysis

AI-generated, general educational analysis — not personal investment advice.

Let me start with what I like. Ola Electric operates in a visible industry—electric two- and three-wheelers—and it has a revenue base of ₹470 Cr in the latest quarter. But my discipline is not about visibility; it is about durable economics. Last quarter sales were ₹470 Cr and net loss was ₹487 Cr. That is a business losing more than it sells. Sales growth is -52.75%, so the top line is collapsing, not compounding. I cannot earn a return from a company whose ROE is -42.83% and ROCE is -28.09%. Book value is ₹11.66, yet I am asked to pay ₹37.28—3.2 times book—for equity that is being eroded. Free cash flow is -₹5,255 Cr; that is a massive cash furnace. The Altman Z-Score of 0.87 sits deep in distress territory. Debt/equity of 0.69 may look tolerable, but with negative profits and negative cash flow, the debt burden will feel heavier. The reported profit growth of 13.65% is a mirage: it is still a ₹487 Cr quarterly loss. There is no dividend, no earnings support, and promoter holding at 34.59% gives me limited confidence in minority alignment. The Piotroski F-Score of 5/9 is mediocre. This is not a value investment; it is a high-risk turnaround speculation. Graham would say the margin of safety is absent. At best, I would wait for evidence of sales stabilisation, narrowing losses, positive free cash flow, and meaningful improvement in return on capital. Until then, fair valuation is unknowable, and the risk/reward is skewed against the shareholder.

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Data from BSE/NSE filings. AI analysis is for educational purposes only — not investment advice. Scoring methodology · Disclaimer