Ola Showrooms: Electric two-wheeler maker Ola Electric Mobility have been raided again. On Tuesday, officials of four RTO offices raided more than 10 showrooms in Mumbai.
All these showrooms did not have the necessary trade certificates. According to an official of Maharashtra Motor Vehicles Department, four RTOs of Mumbai (Central, West, East and Borivali) have sent notices to these stores. During the action, 10 Ola electric scooters have also been seized.
Ola Showrooms: Action after complaint from other companies
Gurugram’s Pratap Singh & Associates Company had filed a complaint against Ola Electric and some other companies for not having a trade certificate. After the complaint, Maharashtra transport officials have taken action.
Ola Showrooms were also raided a few days ago
On March 8, there were reports of raids on some Ola showrooms. Transport officials had closed many 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 necessary 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
On Tuesday’s action, an Ola Electric spokesperson said that no vehicle has been seized. Earlier, Ola had described the investigation as wrong and biased. The spokesperson had said that 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.
Shares fell 8% on petition for bankruptcy proceedings
Ola Electric shares fell by about 8% on March 17. This decline in the company’s stock came after a bankruptcy petition was filed against a subsidiary of the company.
Understand the whole matter in 3 points
Three companies, Ola Electric Mobility, its subsidiary Ola Electric Technology Private Limited and Rosmerta Digital Services Limited are involved in this case.
Rosmerta Digital, a company that makes high security number plates, has accused Ola Electric Technology Private Limited of withholding outstanding payments of Rs 18 to 20 crore.
For this, Rosmerta Digital has filed a petition in the Bengaluru bench of the National Company Law Tribunal to initiate bankruptcy proceedings against Ola Electric Technology.
In the case, Ola Electric says that it rejects these allegations. It is taking legal advice in this matter and will vigorously challenge the allegations.
Shares fell 65% from all-time high
After the listing of shares in August 2024, Ola’s stock has fallen by about 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%.
