Explained: Why Ola Electric share price fell over 5% today

Shares of Ola Electric Mobility Ltd declined over 5% during Wednesday's trading session after the company received an administrative warning from the Securities and Exchange Board of India (Sebi) for non-compliance with disclosure norms.

The stock hit a low of Rs 75.36 on the Bombay Stock Exchange (BSE), down 4.8% during the session. At around 11:35 am, shares of the company recovered slightly, but were still trading 1.47% lower at Rs 78.

It may be noted that Ola Electric shares have fallen over 15% in a month and 11% in the past five trading sessions.

WHY DID OLA GET SEBI WARNING?

The market regulator took issue with a material announcement made by Ola Electric's promoter and Chairman-cum-Managing Director Bhavish Aggarwal on X (formerly Twitter) at 9:58 am on December 2, 2024.

Sebi noted that the company informed stock exchanges about the same only after several hours, at 1:36 pm (BSE) and 1:41 pm (NSE).

"It is observed that whereas the aforesaid information was disseminated on the stock exchanges by you at 1:36 PM (BSE) and 1:41 PM (NSE) on December 2, 2024, it was announced beforehand on X (formerly Twitter) at 9:58 AM on December 2, 2024 by Bhavish Aggarwal, your promoter and Chairman-cum-Managing Director," the Sebi letter read.

The market regulator highlighted that this action violated Regulation 30(6)(ii) of the Listing Obligations and Disclosure Requirements (LODR), which mandates listed entities to disclose all material information to stock exchanges first and within 12 hours of the event's occurrence.

The regulator also cited Regulation 4(1)(d) of the LODR, which requires listed entities to provide timely and adequate information to stock exchanges and investors.

"By making the aforesaid announcement first on a social media platform instead of disseminating it on the stock exchanges, you have failed to take into consideration the interest of all your stakeholders and follow your obligations in letter and spirit," Sebi added.

The market regulator issued a stern warning, urging the company to enhance its compliance standards and avoid similar violations in the future. Sebi added that non-compliance could lead to enforcement action under the Securities and Exchange Board of India Act, 1992.

Additionally, Sebi directed Ola Electric to present the matter and its corrective steps to the Board of Directors and disclose this communication to stock exchanges