Ola Electric stock in focus on nod to raise Rs 1,700 crore

Ola Electric Mobility Ltd has announced plans to secure up to ₹1,700 crore through the issuance of non-convertible debentures (NCDs) or other debt instruments. This decision, finalised during a recent board meeting, allows the company to engage in fundraising via private placements or other legal avenues, adhering to pre-approved borrowing limits. The specifics of the debt instruments, which may include term loans and working capital facilities, alongside the structure and timing, will depend on prevailing market conditions and the company’s financial necessities. On Thursday, the shares of Ola Electric closed at ₹51.50 on the BSE, marking an increase of ₹0.14 or 0.27%.

In a separate development, Ola Electric faces operational challenges in Maharashtra, where the state’s Transport Department has mandated the closure of more than 100 showrooms due to a lack of mandatory trade certificates. Out of 131 showrooms, 107 were found lacking the necessary certifications, prompting the issuance of 104 show cause notices and immediate suspension orders for non-compliant operations. As of now, 43 showrooms have been closed and 214 vehicles seized. The local Regional Transport Offices have been instructed to deactivate the login credentials of the defaulting dealerships within 24 hours as part of enforcement measures.

The recent actions by Maharashtra authorities underscore operational hurdles for Ola Electric, potentially impacting its market presence in the state. Despite this, the company's strategic financial manoeuvre to raise substantial funds through NCDs suggests a focus on bolstering its capital structure amid these regulatory challenges. These developments come at a time when market conditions and compliance issues are increasingly influencing business operations, emphasising the importance of adhering to local regulations.