Ola Electric subsidiary faces insolvency as operational creditor alleges non-payment of dues
In a regulatory filing, Ola Electric confirmed that Rosmerta Digital Services has filed a petition under Section 9 of the Insolvency and Bankruptcy Code, 2016.
Ola Electric Mobility Ltd has confirmed that its wholly owned subsidiary, Ola Electric Technologies Pvt Ltd, is facing an insolvency petition filed by its vehicle registration service provider, Rosmerta Digital Services Ltd.
The petition, submitted under Section 9 of the Insolvency and Bankruptcy Code, 2016 (IBC), has been brought before the National Company Law Tribunal (NCLT), Bengaluru Bench, alleging non-payment for services rendered.
In response, Ola Electric has strongly disputed the claims and stated that it has sought appropriate legal advice. The company asserted that it will take all necessary and appropriate steps to protect its interests and challenge the allegations in this matter.
This development comes amid Ola Electric's broader restructuring efforts, which include renegotiating agreements with registration service providers, such as Rosmerta Digital Services Pvt Ltd and Shimnit India Pvt Ltd, to optimise costs and enhance the efficiency of its vehicle registration process.
Last week, the company announced that its registration transformation was in its final stages, with daily registrations crossing 800—outpacing average daily sales in January and February 2025.
The insolvency proceedings also coincide with Ola Electric's ongoing workforce reduction, which is expected to impact around 1,000 employees across various functions as part of its strategy to streamline operations and mitigate losses.
Apart from the layoffs, in February, the company eliminated regional warehouses across the country and said it would leverage its network of 4,000 retail stores nationwide for maintaining vehicle inventory, spare parts, accessories, and last-mile deliveries. This move is expected to boost the SoftBank-backed Ola Electric’s EBITDA margins by almost 10 percentage points, the company said.
(Disclaimer: Shradha Sharma, Founder and CEO of YourStory, is an independent director at Ola Electric.)
Edited by Kanishk Singh