Firstly, you need to download the new theme package from your Themeforest account. Once you have the new theme package, you can upload the theme via WordPress.
Step 1: You need to deactivate the current Molly theme in Appearance > Themes section by simply activating a different theme. Once you activate a different theme, you can go to theme details to delete the Molly theme.
Step 2: Retrieve the Molly.zip file from your new Themeforest download. If you download All files & documentation, then you need to unzip the archive file you received, the Molly.zip file will be inside of it.
Step 3: Then simply upload and activate the Molly file in the Appearance > Themes section like you've done when installing theme.