Ola Electric Shares Slide 6%, Breaching ₹50 Mark

Shares of Ola Electric Mobility Ltd. took a significant hit on Monday, March 17, plunging by as much as 6% during the trading session. This sharp decline pushed the stock below the psychologically important threshold of ₹50 per share. The downturn came in the wake of legal action initiated against the company by a high-security number plate manufacturer and vehicle registration agency over alleged payment defaults.

According to an exchange filing submitted by Ola Electric over the weekend, the company has been sued by Rosmerta Digital Services Ltd. Rosmerta has reportedly filed a petition with the National Company Law Tribunal (NCLT) in Bengaluru, seeking to initiate Corporate Insolvency Resolution Process (CIRP) against Ola Electric. This move suggests that Rosmerta is attempting to recover outstanding dues from the company through legal means.

The lawsuit stems from allegations that Ola Electric failed to meet its payment obligations to Rosmerta. The specifics of the outstanding payments and the nature of the business relationship between the two companies have not been disclosed in detail. However, the filing of the insolvency petition indicates that the dispute is significant enough to warrant a legal resolution under India’s corporate insolvency framework.

In response to the legal action, Ola Electric has strongly denied the allegations. The company stated that it has sought appropriate legal advice and plans to challenge the claims made by Rosmerta. Ola Electric maintains that it disputes the allegations and intends to take all necessary steps to protect its interests and defend itself against the petition.

The development has raised concerns among investors, contributing to the notable decline in the company’s share price. Market observers are likely to closely monitor how the legal proceedings unfold and how Ola Electric navigates the situation in the coming weeks. The outcome of this case could have broader implications for the company’s financial standing and market performance.

Shares of Ola Electric Mobility Ltd. faced renewed pressure on Monday, sliding by 6% to settle at ₹47.45 per share. This latest decline reflects growing investor concerns over the company’s financial and operational challenges. Ola Electric’s stock has now dropped by a staggering 37% from its initial public offering (IPO) price of ₹76 per share. Moreover, the stock has tumbled approximately 70% from its post-listing peak of ₹157 per share, highlighting a sharp correction in investor confidence. Over the past month alone, the stock has fallen by 18%, indicating sustained weakness in market sentiment.

The recent drop in Ola Electric’s share price comes at a time when the company’s sales figures have been under scrutiny. According to data from the Ministry of Road Transport and Highways, Ola sold 8,647 electric scooters in February 2025. However, this figure is notably lower than the company’s own reported sales numbers. Ola Electric has claimed that it sold over 25,000 units in February, creating a significant discrepancy between government-reported data and the company’s internal reporting. This inconsistency has raised questions among investors and analysts regarding the company’s sales transparency and reporting practices.

The company had previously addressed some of these concerns. On February 19, 2025, Ola Electric announced that it was in the process of renegotiating contracts with its vehicle registration agencies. The company stated that this renegotiation would temporarily affect the recording of registrations on the government’s vehicle registration portal. However, Ola maintained that the renegotiations would not impact actual sales performance, implying that the reported gap in sales figures was more a result of procedural issues rather than a decline in business activity.

Despite the ongoing challenges, Ola Electric has expressed confidence in its future financial performance. In a corporate update released last week, the company projected that its automotive business would become profitable on an Earnings Before Interest, Tax, Depreciation, and Amortisation (EBITDA) basis by the first quarter of the 2026 financial year. This suggests that Ola expects its cost management strategies and operational improvements to start bearing fruit within the next year.

The combination of sales discrepancies, legal challenges over alleged payment defaults, and ongoing contract renegotiations has placed Ola Electric under considerable market pressure. Investors are likely to closely monitor the company’s ability to resolve these issues and deliver on its profitability targets in the coming quarters. The unfolding developments will play a crucial role in shaping market sentiment toward the stock.