Ather Energy Hits New Record High, HSBC Increases Target Price to INR 700

After HSBC increased its target price (TP) for the company, shares of EV manufacturer Ather EnergyAther Energy Datalabs_in-article-icon rose 7.8% to INR 678.50, reaching a new all-time high during today’s intraday trading on the BSE. The TP for Ather was raised by the brokerage from INR 600 to INR 700. The new target price translates to an increase of over 11% from Ather’s closing price yesterday (INR 629.55). HSBC estimates that Ather’s sales volumes will consistently rise due to the growing number of stores. “Volumes have consistently risen over the past few months, even as competition from incumbents has intensified, due to the company opening more stores,” it stated in its report.HSBC anticipates Ather's sales to surge by 22% quarter-on-quarter in Q2 FY26, as retail sales during the quarter averaged 18,000 units. Ather’s EBITDA loss margin is projected to enhance by 110 basis points (bps) on a quarterly basis and by 420 bps on a yearly basis, owing to improved operating leverage. “Ather has positioned itself as a robust brand within the EV sector, and we anticipate that the response to the EL platform will surpass our prior expectations; consequently, we are increasing our estimates and adjusting our target price to INR 700 (up from INR 600),” it added.

In the meantime, HSBC lowered its rating for Ola Electric from ‘Hold’ to ‘Reduce’ and reduced the target price from INR 55 to INR 45.The brokerage noted that Ola Electric was losing market share amid growing competition, even with catalysts that should have benefited it in Q2 FY26. “According to Vahan registrations, we anticipate a quarterly decrease of 20% in Ola volume, bringing it down to 55K units,” it stated. It does foresee, though, that Ola Electric’s gross margin will increase by 220 basis points quarter on quarter to reach 28% in the second quarter, thanks to cost optimisation from the Gen 3 platform. Additionally, the brokerage highlighted that Ola Electric incurs fixed costs that exceed those of its rivals.“Ola exhibits greater vertical integration in the production of components (such as batteries and motors). “The sales are conducted through COCO distribution models (company owned, company operated), which is detrimental to Ola’s profitability in the low-volume environment,” it said.