Shares of Ola Electric Mobility Ltd dropped 5 per cent in Wednesday's trade after the company received an administrative warning from the market regulator SEBI for violation of regulations with respect to disseminating of information. SEBI noted that the Ola Electric Mobility promoter and Chairman-cum-Managing Director Bhavish Aggarwal made a material announcement on X (formerly Twitter) on December 2 beforehand, and only after several hours did the company inform stock exchanges about the same.
Regulation 30(6)(ii) of the LODR prescribes that the listed entity shall first disclose to the stock exchanges all events or information which are material in terms of the provisions, as soon as reasonably possible and, in any case, no later than twelve hours from the occurrence of the event or information.
Ola Electric shares fell 4.8 per cent to hit a low of Rs 75.36 on BSE. The stock is down 18 per cent in the past one month.
"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.
"Regulation 4(1)(d) of the LODR prescribes that the listed entity shall provide adequate and timely information to recognised stock exchange(s) and investors, you have failed to provide the aforesaid information to stock exchanges and all investors in a timely manner," SEBI said.
The market regulator said Regulation 4(1)(h) of the LODR prescribes that the listed entity should 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," SEBI said.
The market regulator said the violations have been viewed very seriously and, thus, warned and advised the company to be careful in the future and to improve compliance standards to avoid recurrence of such instances, failing which appropriate enforcement action may be initiated in accordance with the provisions of the Securities and Exchange Board of India Act, 1992 and the Rules and Regulations framed thereunder.
"You are also advised to take corrective steps, place this communication and the corrective steps taken before your Board of Directors and disseminate a copy of this communication on the stock exchanges that you are listed on," SEBI said.
Meanwhile, regarding the intimation of Show Cause Notice received by Ola Electric Mobility Ltd from the Central Consumer Protection Authority (CCPA), the Karnataka High Court has granted an extension of six weeks for Ola Electric Mobility to submit the response in respect of seeking additional documents and information by the CCPA. Ola Electric said it will ensure a timely response within the specified timeframe.