Ola Electric shares surge 18% after weak market debut

Ola Electric shares: Shares of Ola Electric Mobility saw a significant rise, climbing by as much as 18% to an intraday high of Rs 89.50 following a cautious market debut on Friday, August 9. The stock initially opened flat at Rs 76, the same price as its Initial Public Offering (IPO) issue, which was oversubscribed by 4.27 times.

Ola Electric successfully raised Rs 6,145.56 crore through the IPO, which included a fresh issue of Rs 5,500 crore and an offer for sale (OFS) worth Rs 645.56 crore. Despite the subdued opening, the stock's rise in early trading reflects cautious optimism among investors about the company's future in the electric vehicle market.

Prior to the IPO, Ola Electric secured Rs 2,763.03 crore from anchor investors, allocating 36.36 crore equity shares at Rs 76 each. The anchor investor group featured a mix of prominent foreign and domestic institutions, including SBI Mutual Fund, HDFC Mutual Fund, Nippon Mutual Fund, and Mirae Asset Mutual Fund, among others.

Prashanth Tapse, Senior VP (Research) at Mehta Equities Ltd., advised that while the short-term outlook remains cautious due to the company's weak financials and potential future cash flow risks, risk-tolerant investors might consider holding the stock for a minimum of 2-3 years.

As of 11:07 am, Ola Electric shares were trading 17% higher at Rs 89.14.