Ather Energy IPO to hit Street on Apr 25. Check details

Electric scooter maker Ather Energy has announced its plans to go public, where it will launch its public offer on April 25. The issue will be available for public subscription till April 30. This will be the first mainboard IPO to hit the markets in over two months.

The IPO comprises a fresh equity sale of Rs 2,626 crore and also an offer for sale (OFS) of 1.1 crore shares. Under the OFS, promoters Tarun Sanjay and Swapnil Babanla will offload part stakes along with other corporate selling shareholders.

The price band for the public offer is not yet announced.

Funds raised from the IPO will be used for capital expenditure for establishment of an electric two-wheeler factory in Maharashtra, India, repayment of debt, investment in research and development, expenditure towards marketing and general corporate purposes.

Ather Energy is a pure play EV company that sells electric two-wheelers. The company also makes battery packs in-house using lithium-ion cells procured from suppliers and outsources the manufacturing of all other vehicle components, such as electronics and chassis.

Its electric two-wheeler portfolio comprises two product lines, the Ather 450 and the Ather Rizta, with seven variants. The Atherstack is in-house developed software, which provides features related to navigation, analytics, ride assistance, safety and productivity.

The company commands just about 11% market share in the electric two-wheeler market, as of December 2024. Given its premium positioning with plans to bridge key products, analysts expect the company to achieve a big leap in terms of growth

Launches like Rizta and a new scooter should materially expand the addressable market given that current volumes are constrained due to limited performance segment numbers in its flagship 450 series.

However, distribution too is skewed, where the South market comprises 48% of Ather experience centers, contributing 68% of the company’s volumes in FY24.

Critical factors that can impact the company’s plans and prospects include slow ramp-up and competition from large 2W OEM, and demand incentive scale-down.

According to the CRISIL Report, India is the largest global motorised two-wheeler market by volume with 18.4 million units sold in FY24, of which 16% were exports. In the nine months ended December 2024, exports accounted for 17% of the overall two-wheeler sales in India.