Electric two-wheeler Ather Energy set to break the over 2-month lull on IPO Street

It's been a quiet period on the IPO street for the past two months amid volatile equity markets and global uncertainty fuelled by the reciprocal tariffs announced by the US Administration.

 

That lull is set to be broken with electric two-wheeler maker Ather Energy,  set to ride in its initial public offering, which will include fresh fundraising as well as an offer for sale from existing investors.

 

As per the red herring prospectus filed by the maker of the Ather 450x and Rizta scooters, the company will raise up to ₹2,626 crore from the fresh issue of shares. This, though, is slightly lower than the ₹3,100 crore it had earlier planned to raise as per its draft prospectus.

 

The issue has been priced in the ₹304-321 range. It will open on April 28 and close on April 30.

 

Ather reported a loss of ₹578 crore for the April-December 2024 period, compared with ₹776 crore a year ago.

 

This IPO will also see existing investors, including promoters Tarun Mehta, Swapnil Jain, Caladium Investments, National Investment and Infrastructure Fund (NIIF) II, Internet Fund III Pte, and IITM offloading over 1.1 crore shares.

 

Notably, though, India's largest two-wheeler maker Hero MotoCorp, which holds a 40 per cent stake in Ather is not selling its stake in the company.

 

"Our company proposes to utilize the net proceeds towards funding the following objects:  Capital expenditure to be incurred by our company for the establishment of an electric two-wheeler factory in Maharashtra;  repayment/ pre-payment, in full or part, of certain borrowings availed by our company; investment in research and development; expenditure towards marketing initiatives; and general corporate purposes," Ather said. 

 

The setting up of the factory in Maharashtra will incur a cost of ₹927.2 crore, while ₹40 crore will be used for debt repayment.

 

Ather also plans to invest ₹750 crore in research and development and an expenditure of ₹300 crore is likely to be incurred towards marketing initiatives.

 

The funds will be deployed over financial years 2026, 2027, and 2028.

 

Ather reported sales of 107,983 units in the nine months to December 2024, up from 74,333 units in the same period, a year ago.

 

Ather is the fourth largest electric two-wheeler maker in the country, competing with larger Ola Electric, TVS Motor and Bajaj Auto.

 

Business