Ola Electric Mobility Shares Drop 6% Following Show Cause Notice

Shares of Ola Electric Mobility are expected to experience further decline on Tuesday morning after the electric vehicle manufacturer received a show cause notice regarding alleged violations of consumer rights, misleading advertisements, and unfair trade practices.

Ola Electric stated that the show cause notice currently has no impact on the company’s financial, operational, or other activities. They clarified that the notice issued by the Central Consumer Protection Authority does not impose any penalties or financial fines.

The Central Consumer Protection Authority has given the company a 15-day timeframe to respond to the notice. Ola Electric confirmed it would provide the necessary supporting documents in its response.

Ola Electric Mobility shares fell 6.18% to a low of Rs 85.21, marking a 46% decrease from its recent high of Rs 157.53, reached on August 20. The stock garnered attention recently due to a public exchange between founder and CEO Bhavish Aggarwal and comedian Kunal Kamra on X, which centred around service issues with Ola EV scooters.

The National Consumer Helpline, managed by the Department of Consumer Affairs, has recorded 10,644 complaints since September of last year concerning service issues related to Ola e-scooters, covering the period from September 1, 2023, to August 30, 2024. Of these complaints, 3,389—nearly one-third—relate to delays in servicing the e-scooters, while 1,899 involve delays in delivering new vehicles. An additional 1,459 complaints were lodged for services that were promised but not delivered.

Ola Electric, the largest pure-play electric vehicle company, recently launched its "BOSS - Biggest Ola Season Sale" campaign for the festive season, announcing entry-level pricing for its S1 portfolio starting at Rs 49,999, along with festive benefits of up to Rs 40,000.