Ola Electric shares dropped over 0.80% to ₹42.05 on the National Stock Exchange on Tuesday.
The stock decline marks the third consecutive session of losses, shedding over 5% across these sessions.
Suppliers Sterling E-Mobility Solutions and Anevolve Mando eMobility filed insolvency petitions before the NCLT.
Ola Electric Stock Slides 5% in Three Sessions Amid Vendor Insolvency Plea
Sterling E-Mobility Solutions, the EV components subsidiary of listed Sterling Tools, and Anevolve Mando eMobility, part of the ₹20,000-crore Anand Group, have approached the National Company Law Tribunal (NCLT) to initiate insolvency proceedings over unpaid dues exceeding ₹40 crore
Ola Electric CEO Bhavish Aggarwal
Summary
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Ola Electric Mobility's shares fell over 1% to ₹41.96 on the BSE on Tuesday, marking the third consecutive session of losses for the electric vehicle maker.
The stock opened at ₹42.41, marginally higher than Monday's close of ₹42.39, but has shed more than 5% over the last three trading sessions.
Insolvency Row
The decline follows legal action by two vendors of Ola Electric Technologies, the operating arm of Ola Electric Mobility that accounts for nearly all of the group's revenue, according to a Mint report.
Sterling E-Mobility Solutions, the EV components subsidiary of listed Sterling Tools, and Anevolve Mando eMobility, part of the ₹20,000-crore Anand Group, have approached the National Company Law Tribunal (NCLT) to initiate insolvency proceedings over unpaid dues exceeding ₹40 crore. Both companies have alleged that Ola Electric Technologies failed to settle payments for components supplied to it.
According to filings submitted by Ola Electric Technologies with the Ministry of Corporate Affairs (MCA), dues of ₹29.8 crore to Sterling and ₹10.8 crore to Anevolve remained outstanding for over 45 days, prompting both suppliers to seek recourse through the NCLT.
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"This is a commercial dispute. The suppliers want their dues paid, while Ola Electric also has claims of its own, having raised issues about the quality of parts. Before reaching the courts, this has been going on for a while between the companies," Mint reported, citing a source.
What the Suppliers Make
Sterling E-Mobility manufactures a range of EV components, including traction motors, motor control units and DC converters, which are used in EV powertrain systems.
Anevolve produces EV components such as traction motors, controllers, inverters and AC/DC converters, among others.
Ola Electric's share price has remained volatile amid weak market sentiment. The stock has fallen over 6.57% in the past week. On a year-to-date basis, it has gained 12%, and it is up 1% over the past year.