Ola Electric share price slips 3% as ARAI questions co's pricing practices

Ola Electric share price declined as Automotive Research Association of India asked the company to provide clarification about a price reduction for its S1 X 2 kWh model in its recently announced sale

Ola Electric Mobility shares declined 3.2 per cent in Monday morning deals to log an intraday low of Rs 87.34 per share. The shares of India’s largest electric two-wheeler manufacturer slipped after the company's recent pricing practices came under the lens of the Automotive Research Association of India (ARAI).

ARAI is an automotive testing agency operating under the Ministry of Heavy Industries.

At around 10:58 AM, Ola Electric's share price was down 2.67 per cent at Rs 87.73 per share. The stock fell for the third consecutive session. In comparison, the BSE Sensex was up 0.56 per cent at 81,836.98 at around the same time. The market capitalisation of the company stood at Rs 38,696.21 crore around the same time.

 

ARAI has asked Ola Electric to provide clarification regarding its failure to inform it about a price reduction for its S1X 2kWh model before the launch of the ‘BOSS’ sale as soon as possible. 

In case the company is found to have violated the set guidelines, Ola Electric may face legal action and potentially lose the subsidies its electric vehicles are eligible for under the PM Electric DRIVE Revolution in Innovative Vehicle Enhancement (PM E-DRIVE) scheme.

“Clarification has been requested. If any violations are found, action will be taken in accordance with the law and the scheme guidelines,” said a senior official aware of the developments. READ MORE 

In another blow to the fledgeling company, Ola Electric has been slapped with a notice from Consumer rights regulator CCPA after the National Consumer Helpline received over 10,000 complaints over the past year related to quality and after-sales service of the Ola vehicles.

These complaints, despite being escalated to higher levels of the company for redressal, remained unaddressed, as per reports. READ MORE 

The company posted a loss for the June quarter at Rs 347 crore against Rs 267 crore a year ago. Its revenue for the quarter under review stood at Rs 1,644 crore against Rs 1,243 crore. 

Since its listing on August 9, 2024, Ola Electric shares have lost 1 per cent, compared to the BSE Sensex's rise of 2 per cent during the same period.