Ola Electric Mobility has received an administrative warning notice from the Securities and Exchange Board of India (Sebi), the market watchdog, for failing to disclose certain information. Ola Electric notified the exchanges that it had received the letter via email on January 7.
Sebi's letter claims that the electric vehicle maker first told the exchanges about its expansion intentions on the microblogging site X, later known as Twitter. However, according to Ola Electric, the warning has no appreciable effect on the company's financial results.
The warning relates to ambitions for fourfold expansion announced by Chief Executive Officer Bhavish Aggarwal. Aggarwal said on X on December 20, 2024, "This month, we're taking the electric revolution to the next level." increasing the number of retailers from 800 to 4,000 this month alone. Our objective is to be as near to our clients as we can. On December 20, all stores in India will open simultaneously. It's perhaps the largest one-day store opening ever.
The expansion, however, took place on December 25, 2024.
According to the exchange filing, Sebi issued the administrative warning letter in response to a violation of the Sebi (Listing Obligations and Disclosure Requirements) Regulations, 2015, namely regulations 4(1)(d), 4(1)(f), 4(1)(h), and 30(6), which deal with the channels for distributing information. The purpose of these rules is to ensure that all investors have fair, timely, and affordable access to relevant information.
"By failing to first disseminate the information on the stock exchanges and instead announcing it on a social media platform, you have failed to provide equal and timely access to information for all," the market regulator stated in its letter of warning.
The note continued, "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 Mr. Bhavish Aggarwal, your promoter and Chairman-cum-Managing Director."
"We have taken the aforementioned infractions very seriously. In order to prevent such incidents from happening again, you are hereby cautioned and counseled to be careful going forward and to raise your standards of compliance. If you don't, appropriate enforcement action may be taken in line with the provisions of the Securities and Exchange Board of India Act, 1992 and the Rules and Regulations framed thereunder," the letter stated.
