Ola Electric’s share price surged by 10% in early trade on March 18, a day after reaching an all-time low.
Shares of Ola Electric Mobility Ltd climbed 10.01%, reaching an intraday high of ₹51.63 per share on the NSE. Trading activity was significant, with 40.32 lakh shares exchanged on the BSE, generating a total turnover of ₹20.29 crore. Meanwhile, over 8 crore shares were traded on the NSE by noon.
As of 3:00 PM IST, Ola Electric Mobility share price of was trading at ₹52.64, reflecting a 12.17% increase from its previous close on the NSE.
As a result of the surge, the company’s market capitalization increased by ₹2,421.55 crore, rising from ₹20,691.20 crore to ₹23,112.75 crore.
Invest in Indian Markets and Unlock Future Potential With 5paisa!Stock Rebounds After Previous Session’s Decline
The sharp rebound followed a 7% decline in the stock price on Monday. This drop came after the company disclosed that Rosmerta Digital Services Ltd, its vehicle registration service provider, had filed for insolvency proceedings against its wholly-owned subsidiary, Ola Electric Technologies Pvt Ltd.
In a regulatory filing on Saturday, Ola Electric confirmed that Rosmerta Digital Services Ltd, an operational creditor, had filed a petition under Section 9 of the Insolvency and Bankruptcy Code, 2016 (IBC). The petition, submitted to the National Company Law Tribunal (NCLT) Bengaluru Bench, alleges a payment default and seeks to initiate a corporate insolvency resolution process (CIRP) against Ola Electric Technologies Pvt Ltd.
Market Sentiment and Investor Reactions
The news of the insolvency petition created a sense of uncertainty among investors, leading to the previous session’s decline. However, the stock’s sharp recovery indicates that traders and market participants may see this as a temporary setback rather than a long-term threat to Ola Electric’s growth.
Analysts believe that despite the legal proceedings, Ola Electric continues to hold strong potential in the electric vehicle (EV) sector. The company has been aggressively expanding its product lineup and infrastructure, positioning itself as a major player in India’s EV market.
Additionally, the company has recently secured fresh investments to support its expansion plans, including setting up new manufacturing facilities and enhancing its battery technology. These developments have helped restore some investor confidence, leading to the stock’s rebound.
Job Cuts and Restructuring Efforts
This development comes as Ola Electric Mobility undergoes a restructuring process, which includes cutting approximately 1,000 jobs across various functions to reduce losses. The job cuts are part of the company’s strategy to streamline operations and improve profitability amid rising competition in the EV space.
Despite the job cuts, Ola Electric remains committed to expanding its business. The company has been focusing on developing its next-generation electric scooters and strengthening its charging infrastructure across the country.
Future Outlook
Going forward, investors will closely monitor how Ola Electric handles the insolvency proceedings and whether the company can resolve its financial obligations without major disruptions. The EV industry in India is growing rapidly, with increased government incentives and rising consumer adoption, which could benefit Ola Electric in the long run.
For now, market sentiment remains mixed, with some investors seeing the recent drop as a buying opportunity, while others remain cautious about the ongoing legal challenges and restructuring efforts.
