Why is Everyone on Dalal Street Talking About Ola Electric Mobility?

Ola Electric Mobility is in the news once again. The stock has been extremely volatile over the last few trading sessions.

The shares have dropped significantly by almost 8-10% in the last few days, after a good performance just a few days prior.

Before we tell you reasons for volatility in the stock, let us tell you a little about the company itself.

About Ola Electric Mobility

Ola Electric Mobility is an Indian electric vehicle manufacturer, primarily focused on designing and manufacturing electric two-wheelers and core EV components such as battery packs, motors, and vehicle frames.

The company is known for its Ola S1 electric scooter series, including variants like Ola S1 Air, Ola S1X, and S1 Pro. It operates a large manufacturing facility called the Ola Future factory in Tamil Nadu.

Ola Electric Mobility also develops its own battery technology and is expanding into electric motorcycles and other EV segments.

It is also establishing a large lithium-ion battery manufacturing facility (Ola Gigafactory) and plans to deepen its R&D capabilities, including its Battery Innovation Center.

Why Investors are Talking About Ola Electric Mobility?

Here are some reasons why the company and the stock are in the news...

#1 Auditors Raise Concerns

Ola Electric's auditors have recently raised significant concerns about the company's internal controls, specifically flagging a "material weakness" at its key subsidiary, Ola Electric Technologies, which is the main revenue-generating arm.

The auditors from BSR & Co. LLP highlighted that the subsidiary lacked an adequate internal control system for the physical verification of raw materials and finished goods at company stores and state distribution centers.

This deficiency could lead to potential misstatements in important financial items such as inventories, cost of materials consumed, and work-in-progress accounts.

This issue was noted in Ola Electric's FY25 annual report and points to risks in the accuracy and reliability of the company's inventory reporting.

#2 SoftBank Trims Stake

Japan's SoftBank recently sold a 2.15% stake in Ola Electric, reducing its holding from 17.83% to 15.68%. It sold about 94.9 million (m) shares between 15 July and 2 September 2025.

Despite this stake sale, SoftBank remains one of the largest institutional shareholders in Ola Electric Mobility. SoftBank was an early and significant investor in via multiple funding rounds before the company's IPO.

What Next?

The auditors raising concern show lapses that the company will need to address.

Moving forward, the company in late August 2025 received Certification for Compliance with the eligibility assessment requirements under the Production Linked Incentive (PLI) Scheme for automobile and auto components sector, for its Gen 3 scooter portfolio.

The PLI certification makes Ola Electric eligible for incentives ranging from 13% to 18% of the determined sales value (DSV) until 2028.

With this, Ola Electric's Gen 2 and Gen 3 scooter portfolio is now PLI-certified. The Gen 3 portfolio - S1 Pro 3 kWh, S1 Pro 4 kWh, S1 Pro+ 4 kWh, S1 X 2 kWh, S1 X 3 kWh, S1 X 4 kWh and S1 X+ 4 kWh - represents the majority of the company's current sales.

The company has also entered the sports scooter category with the all-new S1 Pro Sport with 5.2kWh and 4kWh battery packs powered by the 4680 Bharat Cell.

Ola Electric Mobility also unveiled India's first indigenously developed ferrite motor that uses no rare-earth magnets, creating complete supply chain independence. It will be deployed in its vehicle starting Q3 FY26 in a phased manner.

The company is also continuing to build its lithium-ion battery gigafactory in Tamil Nadu to vertically integrate battery cell production, improving cost efficiencies and product offerings.

Conclusion

The auditors' concern is a serious issue that needs to be addressed. It highlights why investors need to factor in corporate governance while analysing companies.

On the business front, Ola Electric aims to leverage AI and vehicle ecosystem development to regain market share, expand in India and abroad, and maintain a competitive edge in the evolving electric vehicle market.

To know more, check out the Ola Electric fact sheet and latest quarterly results. You can also compare Ola Electric Mobility with its peers on our website.

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Investors should evaluate the company's fundamentals, corporate governance, and valuations of the stock as key factors when conducting due diligence before making investment decisions.

Disclaimer: This article is for information purposes only. It is not a stock recommendation and should not be treated as such. Learn more about our recommendation services here...