Home / Industry / Manufacturing /  E-scooter maker Ather Energy tests IPO waters


Mumbai: Bengaluru-based electric 2-wheeler maker Ather Energy has initiated discussions with investment banks, exploring the possibilities of going public in the near future, said two people aware of the development, speaking on the condition of anonymity.

Ather is one of India’s leading electric two-wheeler companies, founded by Tarun Mehta and Swapnil Jain in 2013.

“Ather has met a few of the major domestic and foreign investment banks in recent weeks to discuss the feasibility of an IPO. These are very preliminary talks and they are trying to understand what valuations they can expect if they were to go ahead with an IPO in the coming quarters, as early as end of the year, but most likely in the first half of next calendar year," said the first person cited above.

“Since talks are at a very early stage it is possible that Aether may not go ahead with an IPO at this point of time, given the current market conditions. Tech stocks have taken a beating in the recent market corrections caused by rising interest rates in the US and other major economies and investors are not too excited about tech IPOs right now. But still, a few consumer focused brands such as Ather have started engaging with banks on their IPO plans," the first person added.

A spokesperson for Ather said that the company has no plans for an IPO this year.

Last month Ather raised $128 million in its Series E round of funding from National Investment and Infrastructure Fund Ltd’s Strategic Opportunities Fund and Hero MotoCorp, which is a significant shareholder of Ather, valuing the company a little shy of $1 billion. The company said that it will use the funding to expand manufacturing facilities, invest in research and development, charging infrastructure and to grow its retail network.

“After a strong start to the year, the company registered the highest ever monthly sales in April 2022 delivering 3,779 units to customers. Booking orders for Ather Energy’s flagship product, the Ather 450X is growing at 25% quarter-on-quarter. Ather Energy already has a robust retail sales network across the country, with presence in 32 cities with 38 Experience Centres and aims to expand to 150 Experience Centres in 100 cities by 2023," the company said in a press statement announcing the fundraise.

In an interaction with Mint, Mehta added that Ather will use this investment to scale up production capacity at its second manufacturing plant, which is expected to go on-stream in a “few months from now", and have a production capacity of 35,000 units a month. Ather’s existing production facility has a monthly production of only 10,000 units a month, whereas demand for Ather’s scooters is already in excess of 10,000 scooters a month, Mehta told Mint.

The electric 2-wheeler market is growing and evolving very fast with several competitors such as Ather, Ola Electric, Bajaj Auto, Revolt Motor, Hero Electric, TVS Motor, Okinawa and Ampere, besides several other small players. India’s largest 2-wheeler maker Hero MotoCorp also plans to enter the space later this year.

“Given the competition in the space and evolving regulations, especially around batteries, following the recent spate of safety issues, any serious player in the electric 2-wheeler space will need deep pockets to invest in product development, especially the new age players who don’t have legacy pan-India distribution networks. Going public could help provide Ather access to large pools of capital that are focused on ESG and green investments," said the second person cited above.


Swaraj Singh Dhanjal

" Based in Mumbai, Swaraj Singh Dhanjal is responsible for Mint’s corporate news coverage. For the past eight years he has been writing on the biggest deals in private equity, venture capital, IPO market and corporate mergers and acquisitions. An engineer and an MBA, he started his journalism career in 2014 with Mint. "
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