Ola Electric shares drop 7.2% to record low after insolvency petition

Shares of two-wheeler maker Ola Electric Mobility dropped over 7 per cent to hit a record low on Monday after the company disclosed that one of its units faced an insolvency petition. Shares of the company ended at Rs 46.9, down 7.2 per cent over its previous close. At the last close, the company was valued at Rs 20,687 crore. 

 

Rosmerta Digital Services, a vehicle registration service provider and a creditor of Ola Electric Technologies, filed a petition against the unit alleging default in payments, the electric scooter maker said on Saturday. It did not specify the size of the default. 

 

 

Ola Electric denied the claims and said it had sought legal advice.

 

From its initial public offering (IPO) price of Rs 76, the stock is now down 38 per cent. Since its high-profile stock market debut in August 2024, Ola Electric has faced challenges, including declining sales and increased regulatory scrutiny.

 

Media reports said the company has cut jobs at least twice since November and is now restructuring its sales and service networks, focusing on cost reductions and inventory management.

 

Seven brokerages rate the stock "hold" on average, with a median price target of Rs 73, per data compiled by LSEG.

 

In the October-December quarter, the company posted a wider loss of Rs 564 crore ($64.9 million) due to dwindling demand and deep discounts to attract customers.