Ola Electric Mobility Limited and its founder-chairman, Bhavish Aggarwal, have formally approached the Securities and Exchange Board of India (SEBI) to settle a regulatory probe.

The application was filed under SEBI’s settlement mechanism on April 23, shortly after the market regulator issued a comprehensive show-cause notice on April 10. The filing seeks to resolve the investigation “without admitting or denying” the regulatory findings or legal conclusions, with Ola proposing a financial settlement to avoid prolonged litigation.

The Allegations: Inflation, Discrepancies, and Gaps

The regulatory probe covers public and stock exchange disclosures made by Ola Electric between its high-profile August 2024 IPO and May 2025. SEBI has alleged potential violations of both the Prohibition of Fraudulent and Unfair Trade Practices (PFUTP) and Listing Obligations and Disclosure Requirements (LODR) regulations.

The investigation centers on three primary operational discrepancies:

1. The “Ghost” Service Network Expansion

In December 2024, amid heavy public criticism over its after-sales service quality, Ola Electric informed stock exchanges and declared on social media that it had expanded its physical store network to 4,000 locations, claiming over 3,200 of them were co-located with service centers.

• The SEBI Finding: Data later extracted by the regulator showed that as of February 2025, Ola actually had only 452 co-located service centers operational across India—meaning only 23 facilities had actually been added since its IPO baseline of 429.

2. Redefining “Sales” vs. “Bookings”

In February 2025, Ola announced a monthly sales volume exceeding 25,000 electric two-wheelers, asserting a 28% market share.

• The SEBI Finding: The regulator noted that the 25,207 figure represented unfulfilled customer bookings rather than realized sales. Government VAHAN registration data for that exact month logged only 5,341 actual vehicle registrations for Ola, with revenue recognized on just 2,848 units.
• Furthermore, SEBI flagged that 3,333 of those celebrated February orders were quietly cancelled by April 2025 without any corrective disclosure to the stock exchanges.

3. Delays in the “Roadster” Motorcycle Program

The regulator alleged that Ola withheld timely disclosures regarding manufacturing delays and pending prototype approvals for its highly anticipated electric motorcycle line, despite publicly promising that deliveries would commence by March 2025.

Market and Leadership Fallout

SEBI has held Bhavish Aggarwal personally accountable in his capacity as promoter, managing director, and the firm’s sole executive director, pointing out that he directly amplified the inflated claims across his personal social media feeds. The regulator noted that these announcements directly caused artificial movements in the stock—including an 8.45% intraday surge on December 2, 2024, which occurred alongside peak trading volumes.

While the news of the settlement filing gave the stock a minor 3% intraday bump to roughly ₹44 per share, the company has taken a massive beating since its listing. Ola Electric is currently trading significantly below its initial IPO price of ₹76 per share, wiping out billions in market value as its market capitalization floats around ₹20,400 crore down from its peak of over ₹140 per share in late 2024.