Introduction

Ather Energy, a leading name in India’s electric two-wheeler market, has achieved a significant milestone by obtaining final approval from the Securities and Exchange Board of India (SEBI) to launch its Initial Public Offering (IPO). This development sets the stage for Ather to follow in the footsteps of Ola Electric as the second major electric vehicle (EV) company to list on Indian stock exchanges.

IPO Valuation and Breakdown

The much-anticipated IPO is expected to be valued at approximately Rs 4,500 crore. Of this, Rs 3,100 crore will be raised through fresh equity shares, while the remaining amount will come from an offer-for-sale (OFS) comprising 2.2 crore shares.

Reports indicate that Ather Energy aims to achieve a valuation of $2.5 billion, which is nearly double its August valuation when the company raised $71 million in a funding round led by the National Investment and Infrastructure Fund (NIIF).

Strategic Use of Funds

Ather Energy’s draft papers, filed on September 9, reveal that the company plans to utilize the IPO proceeds to fuel its growth and expansion. Key areas of investment include:

• Setting Up a New Factory: The company intends to establish a state-of-the-art electric two-wheeler manufacturing facility in Maharashtra.
• Debt Repayment: A portion of the funds will be allocated to reduce existing financial liabilities.
• Research and Development: Ather is committed to advancing its technology and product offerings.
• Marketing and Operations: The company will enhance its outreach and operational efficiency to capture a larger market share.

Financial Performance

In the financial year 2024, Ather Energy reported consolidated revenue of Rs 1,753 crore. This figure represents a slight 1.7% decline compared to the previous year. Despite this dip, the company remains confident in the robust growth of the Indian EV market, which is projected to support its ambitious expansion plans.

Promoters and Investors Offloading Stakes

The IPO’s offer-for-sale segment will see the company’s co-founders, Tarun Mehta and Swapnil Jain, each selling 10 lakh shares. Additionally, several existing investors will partially offload their stakes, including:

• Caladium Investment
• National Investment and Infrastructure Fund
• Internet Fund III Pte Ltd
• IITM Incubation Cell
• IITMS Rural Technology & Business Incubator

Ather’s Market Position and Goals

Ather Energy has consistently been at the forefront of India’s EV revolution, with its innovative two-wheeler models like the Ather 450X gaining significant traction. The company’s focus on high-performance, eco-friendly vehicles has positioned it as a leader in the segment.

With the IPO proceeds, Ather aims to strengthen its foothold in the domestic market and explore opportunities in international markets. The planned Maharashtra factory is expected to boost production capacity, enabling the company to meet the growing demand for electric two-wheelers.

Comparison with Ola Electric

Ather’s IPO approval follows closely after Ola Electric’s successful listing earlier this year. While Ola Electric has established itself as a formidable competitor, Ather’s consistent innovation and strong customer base give it a competitive edge. The company’s focus on technology-driven solutions and sustainable growth aligns with India’s vision for an electrified future.

Future Prospects

The global EV market is witnessing unprecedented growth, and India is emerging as a key player. Ather Energy’s strategic initiatives, backed by its IPO funding, are expected to solidify its position as a market leader. The company’s commitment to innovation, sustainability, and operational excellence underscores its readiness to scale new heights.

Conclusion

Ather Energy’s SEBI-approved Rs 4,500 crore IPO marks a significant step in the company’s journey toward becoming a global leader in the electric vehicle space. With plans to expand its manufacturing capabilities, repay debt, and invest in R&D, Ather is poised for substantial growth in the rapidly evolving EV market.