Bengaluru, India (October 7, 2024): Ola Electric, the Bengaluru-based electric two-wheeler maker, has seen its market capitalization plummet below $5 billion on Monday, marking a significant decline since its listing in August.
On the Bombay Stock Exchange (BSE), Ola’s market cap stood at $4.7 billion on October 7. This sharp drop is a far cry from its initial public offering (IPO) in August, where it debuted at an issue price of Rs 76, propelling its market cap to over $7 billion.
The decline in Ola’s market capitalization can be attributed to several factors, including customer complaints regarding after-sales service, software glitches, and hardware problems. These issues have reportedly contributed to a decline in sales of its electric scooters.
Recently, Ola’s chief executive officer, Bhavish Aggarwal, reacted strongly to a comment made by comedian Kunal Kamra on X regarding service issues with the company’s e-scooters. This exchange highlighted the growing concerns and frustrations among customers.
Furthermore, Ola’s market share in the domestic electric two-wheeler segment has been on the decline. According to data from the government portal Vahan, the company’s market share dropped to 27.9% in the previous month. Other players, such as Bajaj Auto, TVS Motor, and Ather Energy, have gained ground, with market shares of 21.4%, 20.2%, and 14.8%, respectively.
The significant drop in Ola Electric’s market capitalization is a clear indication of the challenges the company faces in maintaining its position in the competitive electric two-wheeler market. Addressing customer concerns and improving its overall product and service offerings will be crucial for Ola to regain investor confidence and sustain its growth.
