On Friday, December 19, there was a huge jump in the shares of Ola Electric Mobility. The company’s shares reached the upper circuit of 10% and traded at Rs 34.40. This increase came after the announcement in which the company said that its founder Bhavish Aggarwal has completely repaid the loan of Rs 260 crore by selling a part of his personal shares. The company also informed that the 3.93% shares pledged earlier have now been completely released. With this step, the risks related to pledged shares have been eliminated from the company, which has brought relief to the investors.
Pledge of shares completely free, investors’ confidence increased
In the statement issued by the company, it was said that this was a one-time process, which was done only to eliminate the personal debt of the promoter. This will not have any impact on the company’s business, management or future strategy. Even after this deal the promoter group Ola Electric 34.6% stake remains in it. The company has clearly said that this step is not an indication of reducing the promoter’s stake or exiting the company, but it is a part of financial management.
sudden rise after decline
Ola Electric’s stock was continuously falling for the last few days. A fall of 17% was recorded in only three sessions. The stock had even reached a record low of Rs 30.76. Recently, Bhavish Aggarwal sold his shares for three consecutive days, the total value of which was approximately Rs 324 crore. Due to this, there was increased concern in the market that the promoter might be keeping distance from the company. But after the news of redemption of pledged shares the situation became somewhat normal.
Relief amid challenges of EV sector
These days the demand in the electric vehicle market has slowed down and competition is also increasing. Also, the concern of investors had further increased due to the exit of big investors like SoftBank and some automotive partners. In such an environment, removal of pledged shares has removed a major pressure on the company. Market experts are considering this as a positive sign from governance point of view.
Company’s focus remains intact
Ola Electric reiterated that its focus is on advancing electric mobility and clean energy in India. The company says that the promoter’s share sale was purely on personal level and it will not have any impact on the company’s operations or long-term plans.
Disclaimer: This article is for information only and should not be considered as investment advice in any way. TV9 Bharatvarsha advises its readers and viewers to consult their financial advisors before taking any money related decisions.
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