Ather Energy’s Bold Move: Raising ₹1,340 Crore Ahead of IPO
Ather Energy, an electric two-wheeler manufacturer, recently made headlines by raising ₹1,340 crore from anchor investors ahead of its much-anticipated initial public offering (IPO). This strategic move not only highlights the company’s growth trajectory but also signifies the increasing investor confidence in the electric vehicle (EV) sector. If you’re considering investing in Ather or simply curious about the EV industry’s dynamics, here’s a detailed breakdown of this significant development.
Ather’s Strategic Allocation to Anchor Investors
Ather Energy allocated shares worth ₹1,340 crore (approximately $157 million) to anchor investors, setting the stage for its IPO. The board at Unicommerce passed a resolution to offer 4,17,45,576 equity shares at an issue price of ₹321 each, which is the upper-band limit. This allocation is a testament to Ather’s robust valuation and the trust it has garnered from prominent investors.
Key anchor investors include:
- State Bank of India (SBI)
- Abu Dhabi Investment Authority (ADIA)
- Invesco
- Franklin Templeton
- ICICI Prudential
- Morgan Stanley
- Societe Generale
These investors reflect a blend of domestic and international trust in Ather’s potential. Notably, 49.6% of the total allocation was made to seven domestic mutual funds through 14 schemes, underscoring the domestic market’s confidence in Ather’s future.
The IPO Details and Market Implications
Ather’s public offering was initiated from April 28th to 30th, with a price band set between ₹304 and ₹321. The minimum bid quantity was 46 equity shares, making it accessible to a broad range of investors. Before this anchor round, Hero MotoCorp stood as Ather’s largest shareholder, holding 38.19% of the company. Other significant stakeholders included Caladium Investment (GIC) with a 15.43% stake, the National Investment and Infrastructure Fund (NIIF) with 14.22%, and Tiger Global with 6.56%. Ather’s co-founders, Tarun Mehta and Swapnil Jain, each hold 6.81%.
According to estimates by Entrackr, Ather’s valuation for its IPO was pegged at $1.44 billion. This valuation reflects the company’s potential to disrupt the EV market and expand its footprint in the coming years.
Ather’s Financial Performance: A Mixed Bag
In the first nine months of FY25, Ather sold 1,08,000 vehicles, generating revenue of ₹1,578.9 crore. However, the company also reported a loss of ₹579.6 crore during the same period. For the full fiscal year ending March 2024, Ather’s revenue stood at ₹1,753 crore, with a loss of ₹1,062 crore.
These figures highlight the challenges Ather faces in balancing growth with profitability. The losses, while significant, are not uncommon in the EV sector, where high initial investments in technology and infrastructure are necessary. Investors and stakeholders are keenly observing how Ather plans to navigate these financial challenges while maintaining its growth momentum.
The Broader EV Market Context
Ather’s journey is emblematic of the broader trends in the EV market. As governments worldwide push for cleaner energy solutions, the demand for electric vehicles is set to rise. According to a report by the International Energy Agency (IEA), global electric car sales exceeded 10 million in 2022, and this number is expected to grow exponentially in the coming years.
Ather’s strategic moves, including its IPO and anchor investor allocations, position it well to capitalize on this growing demand. The company’s focus on innovation, customer experience, and sustainable growth will be crucial in determining its success in the competitive EV landscape.
Looking Ahead: What Does the Future Hold for Ather?
As Ather prepares for its IPO, several questions remain. How will the company address its financial losses? What strategies will it employ to expand its market share in the burgeoning EV sector? And most importantly, how will it continue to innovate in an industry that is rapidly evolving?
For potential investors, these questions are critical. Ather’s ability to navigate these challenges will determine its long-term success and impact on the EV market. As you consider your investment options, it’s essential to weigh these factors and stay informed about the latest developments in the EV industry.
In conclusion, Ather Energy’s recent fundraising and upcoming IPO are significant milestones in its journey. With strong backing from anchor investors and a clear vision for growth, Ather is poised to make a substantial impact in the electric vehicle sector. Whether you’re an investor or an EV enthusiast, Ather’s story is one to watch closely in the coming months.
For more insights into Ather’s journey and the EV market, visit Ather Energy.
