Mumbai, March 17 Shares of Ola Electric Mobility Limited tumbled 7.23 per cent, or Rs 3.65, on Monday, hitting a record low of Rs 46.86 on the National Stock Exchange (NSE).
With this drop, Ola Electric’s stock fell below the Rs 50 mark for the first time. The company’s shares have now fallen 37 per cent from its issue price of Rs 76 per share and is down 70 per cent from its post-listing high of Rs 157.
Over the past month alone, the stock has declined by 18 per cent. The sharp decline came after the company disclosed that an insolvency petition had been filed against its wholly-owned subsidiary, Ola Electric Technologies, by Rosmerta Digital Services.
In a filing over the weekend, the company confirmed that Rosmerta Digital Services had approached the National Company Law Tribunal (NCLT) in Bengaluru, seeking to initiate corporate insolvency proceedings against Ola Electric Technologies.
In response, Ola Electric stated that it strongly disputes the claims and has sought legal advice. The company assured that it will take all necessary steps to protect its interests and challenge the allegations made in the petition.
"We wish to inform you that a petition has been filed under Section 9 of the Insolvency and Bankruptcy Code, 2016 by M/s. Rosmerta Digital Services Ltd, an Operational Creditor of Ola Electric Technologies Pvt Ltd, a wholly owned subsidiary of Ola Electric Mobility Ltd,” the Bhavish Agrawal-led company informed exchanges over the weekend.
It further stated that the petition has been submitted before the National Company Law Tribunal's Bengaluru Bench (NCLT, Bengaluru), alleging default in payment towards the services rendered by the operational creditor and seeking initiation of the Corporate Insolvency Resolution Process ("CIRP") against the Ola Electric Technologies Pvt Ltd.
Ola Electric has been in the spotlight recently due to its sales performance. According to data from the Ministry of Road Transport and Highways, the company sold 8,647 scooters in February. However, Ola Electric claims its actual sales exceeded 25,000 units.
Last month, the company mentioned that it was renegotiating contracts with its vehicle registration agencies.
This, it said, would temporarily impact vehicle registrations on the government portal but would not affect actual sales.
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