Ather hiring investment banks for IPO this year, eyes to raise Rs 3,300 cr | Company News – Business Standard

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Ather Energy, the electric vehicle (EV) scooter brand, is hiring investment bankers to help the firm with its initial public offering (IPO) plans this year, according to people familiar with the matter.


The Bengaluru-based firm plans to raise an estimated $400 million (Rs 3,300 crore) through the IPO this year. The company is targeting a valuation of about $2 billion, according to sources.


“The company met the bankers,” said a person. “The firm also has plans to prepare and file the Draft Red Herring Prospectus (DRHP).”


Ather competes with players such as Ola Electric, Bajaj, Ampere, Hero MotoCorp, and TVS Motor Company. It has been making efforts to achieve profitability as it prepares for the IPO.


The company’s total revenue increased by 336.6 per cent year-on-year to Rs 1,783.6 crore in the financial year 23, according to Hero MotoCorp’s annual reports. Hero MotoCorp, India’s largest two-wheeler maker, owns about 39 per cent in Ather Energy.


The sale of scooters was the primary source of revenue for Ather. Some portion of its operating income also came from the after-sale and subscription services.


Ather’s net loss jumped by 151.2 per cent year-on-year to Rs 864.5 crore in the financial year 23 as the firm continued to focus on expanding volumes and market share.


The firm has two manufacturing facilities, which have the capacity to produce 430,000 batteries and 420,000 vehicles annually. Along with the upcoming family scooter, the upgraded 450X called Apex, and its current product spread, Ather’s volumes are set to grow four-fold to 400,000 vehicles a year by the financial year 26.


The surge in demand for electric two-wheelers in India has been remarkable, catapulting from less than 1 lakh vehicles between the financial year 18 and the financial year 23 to around 12 lakh vehicles, with 60 per cent of them being two-wheelers. India now aspires to boost its EV volumes to 30 per cent of the overall vehicle market by 2030.


Ather was founded by Tarun Mehta and Swapnil Jain, graduates of IIT Madras, in 2013. It has raised a total funding of $445 million from investors including Tiger Global, Flipkart founders Sachin Bansal and Binny Bansal, and India’s quasi-sovereign fund NIIF, according to Tracxn.


Over the years, Ather has been working closely with industry leaders to design, develop, and produce crucial components. In 2013, when Ather started building its scooters, it realized there was a shortage of suppliers specializing in EV components and has been working closely with suppliers since then. This has not only helped in addressing the initial shortage of EV components but has also nurtured an environment of mutual growth and innovation.


Ather declined to comment on its IPO plans.


Ather’s chief rival Ola Electric filed its draft red herring prospectus (DRHP) on 22 December with the Securities and Exchange Board of India for its IPO. This was a fresh issue of equity shares of up to Rs 5,500 crore and an offer for sale (OFS) of more than 95 million equity shares at a face value of Rs 10.


Ola Electric registered strong growth as total revenue went up by 510 per cent to Rs 2,782 crore in the financial year 23 from Rs 456 crore in the financial year 22. But its net loss doubled to about Rs 1,472 crore in the financial year 23 from Rs 784.1 crore in the previous financial year.

First Published: Feb 15 2024 | 7:58 PM IST