Shares of Ola Electric Mobility are in focus today after the Central Consumer Protection Authority (CCPA) requested additional documents and information under the ongoing investigation into the Bengaluru-based electric two-wheeler manufacturing company.
The shares closed 3% down on the BSE on Friday at ₹73.4 apiece. The stock is currently trading 2.5% down at ₹71.53 apiece on the NSE on Monday, January 13. Ola Electric’s market capitalisation stands at ₹31,550.67 crore as per NSE data.
“In continuation of the earlier letter received from the Central Consumer Protection Authority dated Dec. 4, 2024, by Ola Electric, we would like to inform you that the company has received a further request for information via email dated Jan. 10, 2025,” the EV maker said in an exchange filing on Friday.
This comes following the Karnataka High Court order granting the company a six-week extension to submit a response to the previous letters by the CCPA.
CCPA notice: In October last year, the CCPA issued a show-cause notice to the company on October 8, 2024, over many claims of consumer rights violations, misleading advertising, and unfair trade practices. The company, in its response, said that it has resolved 99.1% of the 10,644 complaints it has received. The CCPA then demanded additional information, giving Ola Electric 15 days to respond. The Karnataka High Court last week refused to quash the CCPA notice for additional information, granting the company six weeks to submit a response. Following the court order, Ola Electric’s stock plunged by nearly 4% on January 8. The company has maintained that the latest developments with the CCPA do not have financial implications on its operations.
SEBI warning: Last week, the Securities and Exchange Board of India (SEBI) warned the company against announcing its expansion plans on social media before filing with the exchanges. “The Company has received an administrative warning via email on January 7, 2025, issued by SEBI through its letter dated January 7, 2025,” the company said in the BSE filing. The stock fell by over 5% during the intraday trade following the warning by the SEBI.
Management level rejigs: The company’s top management has seen many changes recently with its chief technology and product officer Suvonil Chatterjee and chief marketing officer Anshul Khandelwal resigning from their positions. Many other executives at the senior level have departed from Ola Electric and other entities including Krutirim and Ola Cabs.
Consumer complaints: Ola Electric has been receiving complaints from its customers across the country. Amid the increasing concerns, the company announced 3,200 new stores in December 2024, expanding its reach to nearly 4,000 locations in India.
Market share: The company’s market share fell by over 5% in December to 19.5%, as per a report by the Economic Times.
For the second quarter of the current fiscal year (Q2 FY25), the company posted a consolidated net loss of ₹495 crore, down from ₹524 crore in the year-ago period.
The company recorded a consolidated revenue of ₹1,214 crore, noting a 38.5% year-on-year (YoY) rise from ₹873 crore in the same quarter last year. The narrowed losses and increased revenue are aided by increased sales and lower raw material costs, the company said.
Its Earnings Before Interest, Tax, Depreciation, and Amortisation (EBITDA) stood at a loss of ₹379 crore for the July-September quarter, improving from the previous year’s figure of ₹435 crore. The company reported a gross margin of 20.3% for the quarter. It delivered 98,619 units, showing a strong growth of 73.6% when compared to the year-ago quarter, a company release said.
Amid the woes, the company has focused on diversifying its offerings with plans to launch 20 new products in the two-wheeler and three-wheeler categories over the next two years. It launched S1 Z and Gig in November last year at affordable prices for gig workers. Moreover, it recently launched its Roadster motorcycle series, deliveries for which are expected to begin in January 2025.
