The shares of Ola Electric Mobility on Monday (October 14) experienced a significant decline in the stock prices after the reports concerning around the company's pricing strategies which is currently under investigation by the Automotive Research Association of India (ARAI).
According to Business Standard report, ARAI has asked Ola Electric to provide clarification and compliance details immediately. If found guilty of violating these guidelines, the company risks facing legal repercussions, including potential disqualification from receiving subsidies under the PM Electric DRIVE Revolution in Innovative Vehicle Enhancement (PM E-DRIVE) scheme.
Following the shares of the company took a 3.2 per cent hit in Monday morning trade, reaching an intraday low of Rs 87.34 per share.
At 14:01 PM IST, the shares of the company were trading at Rs 88.15 apiece on BSE, down by 2.26 per cent. Similarly, on NSE, the shares traded at Rs 87.79 apiece, shedding by2.67 per cent.
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ARAI Investigation on Pricing Practices
The trouble began when ARAI, a key automotive testing body under the Ministry of Heavy Industries, raised questions about Ola Electric’s recent pricing decisions. The probe is primarily focused on the company’s failure to inform the regulatory body about a price cut for its S1X 2kWh model before the launch of the "BOSS" sale, added reports.
Consumer Complaints Add to Woes
Adding fuel to the fire, in recent, the company has also been slapped with a notice from the Central Consumer Protection Authority (CCPA).
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As per reports, over 10,000 complaints has been lodged on the National Consumer Helpline in the past year, primarily concerning the quality of vehicles and inadequate after-sales service.
Stock Listing
The company was listed in the stock market on August 9, 2024.