Ather Energy Receives SEBI Approval to Launch IPO for Fundraising
Ather Energy, an electric vehicle (EV) manufacturer, has received approval from the Securities and Exchange Board of India (SEBI) to launch its initial public offering (IPO). The company received the observation letter from SEBI on December 23, indicating approval for the public offering. Ather Energy aims to become the second EV maker in India to list on the stock exchanges, following Ola Electric.
IPO Structure
The IPO comprises a fresh issuance of shares worth INR 3,100 crore and an offer-for-sale (OFS) of up to 2.2 crore shares by existing investors. The company also plans to raise INR 620 crore through a pre-IPO placement, which will be deducted from the fresh issue size if it occurs.
Use of Proceeds
Ather Energy plans to utilize the funds raised from the IPO for various purposes, including:
- Establishing a new electric two-wheeler factory in Maharashtra
- Repaying existing debt
- Investing in research and development (R&D)
- Enhancing marketing initiatives
- General corporate purposes
Valuation
Ather Energy is reportedly targeting a valuation of around $2.5 billion for its IPO. This is a significant increase from its previous valuation of $1.3 billion in August 2024, after a funding round led by the National Investment and Infrastructure Fund (NIIF)
Investors Participating in the OFS
Several investors, including Tiger Global, Caladium Investments, NIIF, Binny Bansal’s 3 State Ventures, and cofounders Tarun Mehta and Swapnil Jain, will offload their stakes through the OFS. However, Hero MotoCorp, Ather’s largest shareholder with a 37.2% stake, will not participate in the OFS.
Financial Performance
In the financial year 2023-24, Ather Energy's consolidated net loss increased to INR 1,059.7 crore from INR INR 864.5 crore in the previous fiscal year. The company's revenue from operations experienced a slight decline of 1.5% year-on-year to INR 1,753.8 crore during the same period.
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