Ola Electric shares have staged a remarkable recovery after a steep selloff, with analysts now focusing on the Rs 70 zone as the next key test. Buoyed by technical breakouts, growing optimism around profitability, and policy tailwinds from PLI certification, the stock is gaining traction. However, momentum indicators suggest occasional pullbacks are likely, urging cautious optimism. 📈

What’s Driving the Rebound? 🔍

The recent surge in Ola Electric shares is supported by strong technical signals and improving market sentiment. On August 30, 2025, the stock closed at Rs 54, trading above its short- and medium-term moving averages but still below the 200-day average, indicating a constructive yet recovering trend. Analysts point to a breakout from a falling channel, robust trading volumes, and a pattern of higher highs and higher lows as signs of a sustained rally. However, the Relative Strength Index (RSI) nearing overbought levels at 70 suggests traders should remain vigilant. 📊

The fundamental catalyst is Ola Electric’s PLI certification for its Gen 3 scooters, which has sparked optimism about margin improvements and a path to EBITDA breakeven by Q2 FY26. This policy boost is seen as a game-changer for the company’s cost structure. 💡

The Rs 70 Debate 🎯

Technical analysts are mapping out a price trajectory with interim resistance at Rs 58–62. A sustained close above this range could pave the way for Rs 68–70, making “Ola Electric Rs 70” a focal point for traders. Support levels at Rs 50–52 are seen as ideal for dip-buying, with Rs 52–50 offering healthy correction zones. The RSI’s elevated reading suggests potential pauses, encouraging staggered entries over chasing rallies. 🔧

Policy Tailwind: PLI Certification 🌬️

Ola Electric’s PLI certification now covers both Gen 2 and Gen 3 scooters, with the Gen 3 range—including seven S1 variants—meeting eligibility under the Automotive Research Association of India (ARAI). Incentives of 13%–18% on sales value until 2028 are expected to bolster margins, with profitability impacts projected from Q2 FY26. This certification is a cornerstone of the company’s financial turnaround strategy. 🏭

Market Share and Execution Risks ⚠️

Despite the stock’s rally, Vahan data indicates a slip in Ola’s market share in late August, with competitors like TVS and Ather gaining ground. This disconnect between equity and operational momentum highlights the importance of execution in product rollouts and customer confidence. Challenges like rare earth supply constraints and new model complexities remain risks to sustaining the rally. 🔩

Earnings and Balance Sheet Signals 💸

The latest quarterly results reported a net loss of Rs 428 crore, with revenue halving to Rs 828 crore year-on-year. However, a gross margin improvement to 25.6% signals progress in efficiency. At the AGM, shareholders approved reallocating IPO proceeds for R&D, growth, and debt reduction, aligning with a disciplined approach to support the company’s turnaround. Management’s target of EBITDA positivity by Q2 FY26 dovetails with PLI benefits. 📑

Case Study: A Disciplined SIP Approach 📉

A Pune-based family office initiated a systematic investment plan (SIP) in July when Ola Electric shares were near their 52-week lows. By accumulating shares weekly in the mid-to-high 40s, they maintained a favorable cost basis. Pausing buys on strong up days and using Rs 50–52 as a support zone, the family office balanced risk and reward, aligning with the Q2 FY26 profitability milestone. This disciplined approach could pay off if the Rs 70 target is reached. 🧠

How to Approach Buying Now 🛒

For traders, buying dips near Rs 50–52 and adding on closes above Rs 57 is a prudent strategy, with reassessment near Rs 62–70 where resistance may emerge. Long-term investors may prefer a staggered SIP approach, timing entries with the Q2 FY26 profitability milestone while monitoring market share trends. Tracking volumes, RSI normalization, and updates on product launches and margins will be key. 📡

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