After reports of raids on the showrooms of electric two-wheeler maker Ola Electric Mobility, the company’s stock fell 5.61% on Monday. It closed down by Rs 3 at Rs 53.36.
In fact, two days ago, there were reports of raids on some Ola showrooms across the country. According to a Bloomberg report, transport officials had closed several showrooms and seized vehicles due to lack of trade certificates. Along with this, a show cause notice was also issued to the company by the Transport Department.
Ola Electric has opened 4,000 showrooms since 2022. According to the report, data is available for only about 3,400 of these showrooms. Out of 3,400, only 100 showrooms had the required trade certificates under the Motor Vehicles Act.
More than 95% of the company’s showrooms do not have the basic certification required to display, sell and offer test rides of unregistered two-wheelers.
Ola Electric said – the action is wrong and biased
Ola spokesperson says that the investigation is wrong and biased. Ola’s distribution centers and warehouses in many states have inventory of unregistered vehicles.
It fully complies with the guidelines of the Motor Vehicles Act and has the necessary approvals. The company did not give any information about the raid on the showrooms.
Ola Electric Shares fell 65% from all-time high
After the listing of shares in August 2024, Ola’s stock has fallen 65% from its peak of Rs 157.53. The company’s shares have fallen by about 20% in the last one month. Apart from this, by December 2024, the company’s market share has come down from 49% to 23%.
The company will lay off more than 1,000 employees
Earlier, it was reported that Ola Electric Mobility Limited will lay off more than 1,000 employees and contract workers. Through this, the company wants to reduce its growing losses.
This job cut will affect many departments including procurement, fulfillment, customer relations and charging infrastructure. People familiar with the matter had said that this layoff is part of Ola Electric’s efforts to control costs.
