Ola Electric shares in focus as CCPA seeks more documents amid probe
“In continuation of the earlier letter received from the Central Consumer Protection Authority dated December 04, 2024, by Ola Electric Mobility Limited we would like to inform you that the company has received further request for information via email dated January 10, 2025,” the company said in an exchange filing on Friday post market hours.
It comes days after the Karnataka High Court granted the Bhavish Aggarwal-led firm a six-week extension to submit its response to the CCPA.
The CCPA first issued a show-cause notice to Ola Electric on October 8, 2024, over alleged consumer rights violations, misleading advertisements and unfair trade practices.
In its response on October 21, the company claimed to have resolved 99.1% of the 10,644 complaints it had received. However, on December 4, the CCPA sought additional documents and information, giving the company 15 days to respond.
Ola Electric stated that the latest directive would not impact its financial, operational or other activities.Also Read: Weakness in Nifty could intensify: Technical Analysts
Earlier this week, the Securities and Exchange Board of India (Sebi) issued a warning to Ola Electric for breaching disclosure regulations after CEO Aggarwal announced its expansion plans on social media before notifying stock exchanges.
Along with the regulatory run-ins, the Bengaluru-based company is grappling with several other challenges, including top-level management exits and consumer complaints about vehicle quality and after-sales support.
On December 27, chief technology and product officer Suvonil Chatterjee and chief marketing officer Anshul Khandelwal resigned, adding to a series of senior executive departures across the company’s three entities: Ola Electric, artificial intelligence venture Krutrim and ride-hailing platform Ola Cabs.
The company’s market share fell more than five percentage points in a month to 19.5% in December. Its key competitors include Bajaj Auto, TVS Motor and Ather Energy, which recently secured Sebi’s approval to launch an initial public offering.
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Amid increasing customer complaints, Ola Electric announced in December the opening of 3,200 new stores with service facilities, expanding its store network fourfold to 4,000 locations across India.
The company has also been focusing on diversifying its product portfolio. In November, it launched two new electric scooter models, the S1 Z and Gig, aimed at gig economy workers and cost-conscious consumers. It also unveiled its Roadster motorcycle series, with deliveries scheduled to begin this month.
During its second-quarter earnings call, Aggarwal revealed plans to launch 20 new products across two-wheeler and three-wheeler categories over the next two years, with at least one new release per quarter.
Ola Electric shares target price
As per Trendlyne data, the average target price of the stock is Rs 96, which indicates an upside of 31% from the current market prices. The consensus recommendation from 7 analysts for the stock is a ‘Buy’.
Ola Electric shares performance
On Friday, Ola Electric shares closed at Rs 73.4, down 3% on the BSE, while the benchmark Sensex declined 0.31%. The stock has declined 22% over the past one month and 20% in the last three months. The company’s market capitalization stands at Rs 32,384 crore.
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