Since listing, Ola Electric has been caught in a painful but logical cycle: scale requires capital, capital creates debt, debt elevates risk, and risk compresses multiples. The result is a stock that cannot be valued on any conventional earnings metric because there are no earnings to speak of.
The core issue is capex intensity. In FY26, Ola reported ₹2,253 crore in revenue. Roughly 40% of that — nearly ₹900 crore — was absorbed by capital expenditure alone. A company spending 40 paise out of every rupee it earns on building capacity is not yet a mature business; it is still in construction mode.
| Metric | FY22 | FY23 | FY24 | FY25 | FY26 |
| Revenue (₹ Cr) | 373 | 2,631 | 5,010 | 4,514 | 2,253 |
| Revenue Growth | — | +605% | +90% | –10% | –50% |
| Gross Profit (₹ Cr) | –195 | –48 | 364 | 387 | 690 |
| Gross Margin | –52% | –1.8% | 7.3% | 8.6% | 30.6% |
| EBITDA (₹ Cr) | –800 | –1,252 | –1,266 | –1,735 | –972 |
| EBITDA Margin | –214% | –47.6% | –25.3% | –38.4% | –43.1% |
| Net Profit (₹ Cr) | –784 | –1,472 | –1,584 | –2,276 | –1,833 |
Source: Company filings. FY26 data as per latest available numbers.
Three things stand out from this table. First, gross margins have improved dramatically — from deeply negative to 30.6% in FY26. That is genuine operating progress. Second, EBITDA losses have narrowed from ₹1,735 crore in FY25 to ₹972 crore in FY26, which is also meaningful. Third — and this is the critical concern — revenue fell 50% in FY26. A company improving margins while losing half its top line is in a precarious position. Every efficiency gain is fighting a shrinking revenue base.
“The gross margin story is turning — 30.6% in FY26. The EBITDA story has not turned yet.”
The cash flow picture (FY26) reinforces this. Operating cash flow stood at –₹775 crore, meaning the business consumed nearly ₹800 crore just to sustain operations. Investing activities generated ₹2,002 crore (likely asset monetisation or investment inflows), while financing activities used ₹1,201 crore. Net cash flow was a slim +₹26 crore. The company is not yet self-funding its own operations.
Ola share analysis: Why DCF & Multiples Both Fail Here
Attempting to apply conventional valuation frameworks to Ola Electric in its current state produces results that are either mathematically invalid or economically useless. Here’s why — and what the numbers do tell us.
DCF is non-functional with negative EBITDA. A Discounted Cash Flow model requires positive free cash flows at some horizon to anchor a terminal value. When operating cash flows are –₹775 crore, the model either returns a negative intrinsic value or demands aggressive assumptions about when profitability arrives. With no confirmed EBITDA-positive year in sight, any DCF output for Ola today is more assumption than analysis.
Relative Valuation — Ola Electric (FY26)
- EV / Sales: 8.0x — At ₹17,964 crore enterprise value against ₹2,253 crore revenue, the market is pricing in significant future growth.
- EV / EBITDA: –18.5x — Negative EBITDA makes this metric meaningless. A negative EV/EBITDA cannot be used to assess relative cheapness or expensiveness.
- P / E: –9.1x — Similarly, a negative P/E (derived from net loss of ₹1,833 crore) carries no interpretive value for investor decision-making.
The only multiple that can be used with any integrity here is EV/Sales at 8.0x. In the context of an early-stage EV company with 30%+ gross margins and a massive addressable market, 8x sales is not outlandish — but it requires revenue growth to resume and sustain. If revenue continues declining (as it did 50% in FY26), even 8x sales becomes a stretch.
Peers: Where Ola Stands in Its Segment
To contextualise Ola’s valuation, it is worth placing it alongside two peers — Ather Energy, the closest like-for-like EV pure-play, and TVS Motor, the established two-wheeler incumbent with an EV presence.
| Company | Price (₹) | Mkt Cap (₹ Cr) | EV (₹ Cr) | Sales (₹ Cr) | EBITDA (₹ Cr) | EV/Sales | EV/EBITDA | P/E |
| Ather Energy | 974 | 37,293 | 37,747 | 3,672 | –408 | 10.3x | –92.4x | –72.1x |
| TVS Motor | 3,449 | 1,63,846 | 1,92,136 | 56,070 | 8,352 | 3.4x | 23.0x | 54.3x |
| Ola Electric | 38 | 16,743 | 17,964 | 2,253 | –972 | 8.0x | –18.5x | –9.1x |
| Peer Average | — | — | — | — | — | 6.9x | –34.7x | –8.9x |
Source: base data has taken from screener. Figures in ₹ Crores.
Several observations emerge from this comparison:
Ola trades at a discount to Ather on EV/Sales (8.0x vs 10.3x) despite Ola generating more revenue. Whether this discount is fair or an opportunity depends entirely on which company is closer to EBITDA breakeven — and at –₹972 crore EBITDA versus Ather’s –₹408 crore, Ola’s absolute losses are higher, which partially explains the gap.
TVS Motor provides the benchmark for what the segment looks like at maturity — 23x EV/EBITDA and 54x P/E on a profitable, scaled operation. For Ola to reach TVS-equivalent multiples, it would first need to become profitable, then sustain that profitability long enough for the market to price it accordingly.
The peer average EV/Sales of 6.9x, if applied to Ola’s current revenue of ₹2,253 crore, would imply an EV of roughly ₹15,500 crore — slightly below where it currently trades. However, if revenue recovers and grows 50% annually over the next few years while margins improve, the EV/Sales re-rating story becomes more compelling. The risk is the reverse: if revenue continues declining, even a flat 8x multiple on a shrinking base compresses equity value further.
“Ola trades cheaper than Ather on sales multiples but carries deeper losses in absolute terms. The divergence will resolve when one of them turns EBITDA-positive first.”
How Ola Can Touch ₹100
- EBITDA turns positive — non-negotiable gate condition for any DCF to function.
- Revenue growth resumes at ≥50% annually — the FY26 revenue decline must reverse sharply.
- EBITDA margin reaches ~30% — gross margins are already there; opex control is the remaining variable.
- Terminal growth of 5% — a standard assumption once the high-growth phase stabilises.
- Market re-rates the stock — the business has to prove its profitability is durable, not a one-quarter blip.
A Final Word
Ola Electric is not a traditional stock — and trying to analyse it with traditional tools produces confusion rather than clarity. The EV/EBITDA is negative. The P/E is negative. The DCF stalls on negative cash flows. And yet, the gross margin has gone from –52% to +30.6% across five years. That is not a small achievement.
The honest answer to the question “can ₹38 become ₹100?” is: yes, conditionally. The conditions are demanding and the timeline is uncertain — but they are all operational conditions, not structural impossibilities. Ola is not a dying business; it is a pre-profit business carrying the costs of a scale it has not yet fully monetised.
Whether the stock gets there in two years or five depends almost entirely on one thing: when EBITDA crosses zero. Everything else — the multiples re-rating, the DCF value unlocking, the market cap expansion to ₹44,100 crore — follows from that single event. Watch that number closely.