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If you are wondering why Ola stock is falling, you are not alone. Investors have been closely tracking the sharp correction in shares of Ola Electric Mobility Ltd after its disappointing Q3 FY26 earnings. As of mid-February 2026, the stock is trading near ₹29, down more than 60% from its IPO price. The recent crash has intensified discussions around why Ola stock is falling and whether this is a temporary setback or a structural problem.
Reason why ola stock is falling
The primary reason why Ola stock is falling lies in its weak Q3 FY26 financial performance. Revenue declined 55% year-on-year to ₹470 crore, mainly because sales volumes plunged 61% to 32,680 units from 84,029 units a year ago. While gross margins improved to 34.3% due to production-linked incentives and vertical integration, EBITDA losses widened sharply to negative 58%. Rising losses and increasing net debt of around ₹670 crore have raised concerns about cash burn, directly impacting investor confidence and explaining why Ola stock is falling so sharply.
Another major trigger behind why Ola stock is falling is broker downgrades. Emkay Global cut its rating to “Sell” and slashed the price target to ₹20, citing survival risks amid falling volumes and intense competition. Kotak and other brokerages echoed similar concerns, pointing out that even as the broader EV two-wheeler industry grew 24–33% in early 2026, Ola failed to show volume recovery. Such negative sentiment from analysts has added pressure, reinforcing fears about why Ola stock is falling.
Competition that Ola is facing
Competition has also played a decisive role in why Ola stock is falling. Established players like TVS Motor Company and Bajaj Auto have captured significant market share with reliable service networks and consistent sales growth. As of mid-February 2026, Ola’s market share has fallen to nearly 6%, placing it in fifth position, compared to TVS commanding roughly 28%. Models such as the TVS iQube and Bajaj Chetak have gained consumer trust, especially as subsidies taper off and buyers prioritize reliability. This competitive erosion clearly explains why Ola stock is falling.Service and quality challenges further clarify why Ola stock is falling. Massive service backlogs, sensor issues, and after-sales complaints hurt customer trust in 2025. Although CEO Bhavish Aggarwal acknowledged these issues and launched the “Hyperservice” program to address delays, the recovery has been gradual. Wait times reduced from 14 days to about 7–8 days, with nearly 80% same-day service completion in pilot cities. However, rebuilding brand trust takes time, and until volumes stabilize, concerns over Ola stock will likely persist.
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Ola Strategy to rise up
The company’s strategy includes scaling battery capacity to 6 GWh by March 2026, cutting costs by up to 50%, launching affordable models under ₹80,000, and expanding service networks nationwide. If these initiatives succeed, they could address the core issues behind stock underperformance and potentially restore investor confidence.
Technical Indicators
Technical indicators also provide insight into why Ola stock is falling. The stock remains in a strong downtrend, with support near ₹28 and resistance around ₹34–36. Weak buying interest at higher levels indicates that institutional investors remain cautious. Without a clear turnaround in revenue and market share, technical momentum may continue to weigh on the stock.Looking ahead, the outlook remains mixed. Analysts’ targets mostly range between ₹20 and ₹30, although some optimistic forecasts see recovery toward ₹35–₹40 if execution improves.
Conclusion
In conclusion, the answer to why Ola stock is falling lies in a combination of weak financial performance, declining volumes, broker downgrades, rising competition from TVS and Bajaj, and lingering service challenges. While margin improvements and operational fixes offer some hope, a sustained recovery in sales and market share will be critical. Until then, concerns about why Ola stock is falling are likely to dominate market discussions.
Disclaimer: The information provided in this article is for educational and informational purposes only and should not be considered financial or investment advice. Market outlooks, projections, and opinions are based on publicly available data at the time of writing and may change without notice due to evolving market conditions. Readers are advised to conduct their own research or consult a qualified financial advisor before making any investment decisions. The author and publisher are not responsible for any financial losses arising from the use of this information.
