Ola Electric Share Price Falls Over 38 Per Cent From Issue Price - Know Why

Ola Electric's share price declined more than 38 per cent from the stock’s issue price on March 17 on the NSE. Ola Electric Mobility Ltd stock fell nearly 7 per cent to hit an intraday low at Rs 47.05 apiece on the NSE. The electric two-wheeler maker’s share price declined after it disclosed that an insolvency petition had been filed against one of its subsidiaries.

The electric two-wheeler maker informed the exchanges on March 15 that Rosmerta Digital Services Ltd, an operational creditor of the company has filed a petition under the Insolvency and Bankruptcy Code against Ola Electric Technologies Private Ltd a wholly owned subsidiary of Ola Electric Mobility Ltd. The company also mentioned in the filing that the petition has been submitted before the National Company Law Tribunal – Bengaluru Bench.

“We wish to inform you that a petition has been filed under Section 9 of the Insolvency and Bankruptcy Code, 2016 ("IBC") by M/s. Rosmerta Digital Services Limited, an Operational Creditor of Ola Electric Technologies Private Limited, a wholly owned subsidiary of Ola Electric Mobility Limited ("the Company"). The petition has been submitted before the National Company Law Tribunal – Bengaluru Bench ("NCLT, Bengaluru"),” the company said in the filing.

Rosmerta Digital also alleged a default in payment and sought an initiation of the Corporate Insolvency Resolution Process (CIRP) against Ola Electric Technologies Private Ltd from the NCLT. However Ola Electric said that it has sought appropriate legal advice and has strongly disputed the claims made. The company added that it will take all necessary and appropriate steps to protect its interests and object to the allegations.

As of March 17, Ola Electric shares have extended losses for the third straight session, declining nearly 8 per cent between March 12 and March 17. Shares of Ola Electric made their D-street debut on August 9, 2024, the stock is currently trading 38.09 per cent lower from its issue price of Rs 76 per share.

Earlier in 2024, the company raised Rs 6,145.56 crore through a book-built issue which consisted of a combination of a fresh issue of 72.37 crore shares amounting to Rs 5,500 crore and an offer for sale of 8.49 crore shares amounting to Rs 645.56 crore.

Ola Electric shares have traded with a downward trend, the stock has fallen over 45 per cent on a Year-to-Date (YTD) basis. In six months the stock has fallen more than 59 per cent and in a month the company’s shares have slipped over 26 per cent. In five days the stock has traded lower by nearly 16 per cent.

At the time of writing, Ola Electric Mobility shares traded lower by 6.83 per cent at Rs 47.06 apiece on the NSE.