 "Ola Electric adds 3,200 new outlets to improve after-sales service")
E-scooter manufacturer Ola Electric Mobility Ltd on Wednesday announced the opening of 3,200 new stores over the past month, bringing its total number of showrooms and service centres to 4,000. The milestone was revealed by Ankush Aggarwal, group head of financial services and retail auto business at Ola Electric, during an event streamed live on the company’s social media platforms.
This aggressive expansion is aimed at addressing customer dissatisfaction with after-sales service and boosting the company’s local footprint, particularly in smaller towns. Ola’s direct-to-consumer (D2C) model is expected to make electric vehicle (EV) ownership accessible to every household, the company had previously said in an exchange filing.
Challenging year for Ola Electric
The expansion comes after a challenging year for Ola Electric. Following its blockbuster stock market debut in August, the company faced regulatory scrutiny, a deluge of consumer complaints, and social media backlash over product quality issues.
Ola’s chairman, Bhavish Aggarwal, emphasised the importance of reaching every Indian town and city in a video posted on December 19. The rollout, initially planned for December 20, was later delayed to December 25.
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Customer complaints, which reached a monthly average of 80,000, overwhelmed Ola’s service centres earlier this year. Reports of malfunctioning scooters and a public spat between Aggarwal and a comedian further tarnished the company’s image. In October, the Ministry of Heavy Industries ordered an audit of Ola’s service hubs, and the Central Consumer Protection Authority issued a notice alleging unfair trade practices.
IPO launch and share volatility
The company launched its initial public offering (IPO) from August 2 to August 6, 2024, with a price band set between Rs 72 and Rs 76 per share. On the listing day, the stock opened at Rs 76 per share and quickly surged to hit the upper circuit limit of 20 per cent, closing at Rs 91.20, reflecting strong investor interest and confidence in the company’s prospects.
In its first results filing, the company reported a 38.5 per cent year-on-year increase in revenue, reaching Rs 1,240 crore in the July-September quarter. Ola Electric’s consolidated net loss narrowed to Rs 495 crore, down from Rs 524 crore in the corresponding quarter of the prior year. However, this represents an increase from the Rs 347 crore loss reported in the preceding quarter.
Following its debut, Ola Electric’s share price experienced significant volatility. The stock reached a 52-week high of Rs 157.40 on August 20, 2024, however, it later declined to a 52-week low of Rs 66.66 on November 22, 2024, suggesting investor concerns over the company’s performance and market competition.
The company also faces stiff competition from rivals such as Bajaj Auto Ltd, TVS Motor Co, and Honda Motorcycle and Scooter India Pvt, all of which are stepping up their manufacturing of electric vehicles.
At 2 pm on Monday, the share price stands at Rs 94.05, showing some recovery from its earlier lows.