Ola Electric Shares Fall 4% Following SEBI Warning On Disclosure Violations

According to the Listing Obligation and Disclosure Requirements (LODR) regulations, listed companies are required to make such disclosures on the stock exchanges first

In a warning letter dated January 7, the market regulator stated that the company failed to promptly inform the stock exchanges and all investors

Source : X

The Securities and Exchange Board of India (SEBI) has issued an administrative warning to Ola Electric Mobility for breaching disclosure norms. Post the issue of warning, Ola's shares dropped nearly 3.8 per cent to Rs 76.12 per share on Wednesday.

SEBI noted that Bhavish Aggarwal, the company's chairman and managing director, announced the company's expansion plans on social media platform X (formerly Twitter) prior to making the formal disclosure to investors on the stock exchanges.

Bhavish Aggarwal announced the company’s four-fold expansion plans on December 20, 2024, in a post on X (formerly Twitter) and wrote, "Taking the Electric revolution to the next level this month. Going from 800 stores right now to 4000 stores this month itself. Goal to be as close to our customers as possible. All stores opening together on 20th Dec across India. Probably the biggest single day store opening ever!"

According to the Listing Obligation and Disclosure Requirements (LODR) regulations, listed companies are required to make such disclosures on the stock exchanges first. In a warning letter dated January 7, the market regulator stated that the company failed to promptly inform the stock exchanges and all investors.

“Regulation 4(1)(h) of the LODR prescribes that ‘the listed entity shall make the specified disclosures and follow its obligations in letter and spirit taking into consideration the interest of all stakeholders’, 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,” reads the warning letter.

SEBI stated that the violations are being taken seriously and advised the company to exercise caution in the future to improve its compliance standards, warning that failure to do so could lead to enforcement action.