Ather Energy’s Ambitious IPO Plans: A Step Towards Electric Mobility
Ather Energy, a prominent player in India’s electric two-wheeler market, has announced its intention to launch an initial public offering (IPO) valued at approximately ₹4,500 crore (around $536.2 million). This move comes as the company aims for a valuation of $2.5 billion and seeks to capitalize on the thriving stock market environment following the recent public listing of its competitor, Ola Electric.
Details of the IPO Offering
In this upcoming IPO, Ather plans to issue new shares worth ₹3,100 crore. Additionally, existing investors and key stakeholders—including co-founder and CEO Tarun Sanjay Mehta—will be divesting shares amounting to ₹1,400 crore. These details were revealed by a source familiar with the situation who requested anonymity due to confidentiality concerns.
Despite inquiries from Reuters regarding further comments on this development, Ather has yet to respond.
Competitive Landscape in Electric Two-Wheelers
Ather Energy specializes in manufacturing electric scooters and is currently competing against Ola Electric, which recently made headlines with its own successful IPO. Notably, Hero MotoCorp holds a significant 37.2% stake in Ather but will not participate in selling shares during this IPO process.
The Indian stock market is experiencing remarkable growth; thus far this year alone, around 200 companies have collectively raised over $7 billion through various IPOs according to data from LSEG.
Ola Electric’s recent debut on August 9 was particularly noteworthy as it raised $734 million—one of the largest offerings seen this year—and saw its share price more than double from an initial price of ₹76 before settling at approximately ₹103.99 after some fluctuations.
Growing Demand for Electric Vehicles
While electric vehicle (EV) adoption remains relatively low across India compared to traditional vehicles, there is a noticeable upward trend fueled by government initiatives promoting clean energy solutions under Prime Minister Narendra Modi’s administration.
To support its growth trajectory and enhance production capabilities within this burgeoning sector, Ather intends to allocate funds raised from the IPO towards establishing a new manufacturing facility for electric two-wheelers in Maharashtra as well as investing significantly into research and development efforts aimed at innovation within their product line-up.
Financial Performance Insights
However, it’s important to note that Ather has faced financial challenges; according to their prospectus for fiscal year 2024 they reported an increased loss of ₹1,060 crore compared with losses amounting to ₹864 crore during the previous fiscal period—a trend that raises questions about profitability amidst expansion efforts.
Leading financial institutions such as Axis Capital, JM Financials , Nomura ,and HSBC are acting as book-running lead managers for this significant offering which could reshape investor interest within India’s EV landscape moving forward.
Intern at SMK University
