Electric vehicle

Ather Energy Secures SEBI’s Final Nod for INR 3,100 Cr IPO

• ByStartupStory     |    December 31, 2024

Bengaluru-based electric vehicle (EV) maker Ather Energy has received the green light from the Securities and Exchange Board of India (SEBI) to proceed with its highly anticipated initial public offering (IPO). The markets regulator issued an observation letter to Ather on December 23, which, in SEBI’s parlance, signifies approval for the public offering.

This milestone clears the decks for Ather to become the second EV manufacturer in India to list on the bourses, following Ola Electric’s public debut earlier this year.

Details of the IPO

Ather had initiated its IPO proceedings in June 2024 after converting into a public limited company. By September, the company filed its draft red herring prospectus (DRHP) for an IPO worth over INR 3,100 Cr, which includes a fresh issue of shares amounting to INR 3,100 Cr and an offer for sale (OFS) of up to 2.2 Cr shares.

Prominent stakeholders participating in the OFS include Tiger Global, Caladium Investments, National Investment and Infrastructure Fund (NIIF), Binny Bansal’s 3 State Ventures, and co-founders Tarun Mehta and Swapnil Jain. However, Ather’s largest shareholder, Hero MotoCorp, which holds a 37.2% stake, will not divest its shares during this process.

The OEM is reportedly targeting a valuation of $2.5 Bn through this IPO. Proceeds from the fresh issue will be allocated towards research and development (R&D), marketing, production, infrastructure expansion, and other general corporate purposes.

The DRHP also mentions Ather’s intent to raise INR 620 Cr via a pre-IPO placement, which, if successful, will reduce the size of the fresh issue.

Founding and Growth Trajectory

Founded in 2013 by Tarun Mehta and Swapnil Jain, Ather Energy has grown into a leading player in India’s EV space, designing and manufacturing electric two-wheelers and battery packs. The company also operates its own EV charging infrastructure.

Earlier in 2024, Ather entered the unicorn club after securing INR 600 Cr in funding from its existing investor NIIF, achieving a post-money valuation of $1.3 Bn. The company reported sales of 1.07 lakh EV two-wheelers between January and November 2024.

Financial Performance

Despite its robust growth, Ather’s consolidated net loss widened by over 22% YoY to INR 1,059.7 Cr in FY24, compared to INR 864.5 Cr in FY23. Revenue from operations also declined marginally by 1.5% YoY to INR 1,753.8 Cr in FY24.

IPO in the Context of a Growing Market

Ather’s IPO approval comes months after rival Ola Electric raised INR 6,145.6 Cr at a valuation of $4 Bn through its public listing. Ola’s shares debuted at INR 75.99 apiece on the BSE, almost matching its IPO issue price of INR 76.

The year 2024 has witnessed a surge in new-age tech companies tapping into public markets, with 13 companies raising over INR 29,000 Cr through IPOs. Meanwhile, over 20 companies, including Infra.Market, Ola Consumer, boAt, and OfBusiness, are gearing up for public listings in 2025.

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