Discover why Ather Energy cut its IPO size to $308M and what this means for India’s EV market. Get expert insights on valuation, market conditions, and growth prospects.
Are you ready to dive into the latest development in India’s electric vehicle space? In a significant move that has sent ripples through the tech world, Bengaluru-based EV startup Ather Energy has trimmed its initial public offering by 18% to $308.3 million (₹26.26 billion), according to its latest draft prospectus filed on Tuesday.
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Ather Energy IPO: The Big Picture
The electric two-wheeler manufacturer, founded in 2013 by Tarun Mehta and Swapnil Jain, is now targeting a post-money valuation of $1.4 billion – a notable reduction from its earlier ambitions of $1.5-2 billion last September. This adjustment comes amid changing market conditions, which Ather explicitly cited as the reason for downsizing its IPO expectations.
Here’s what the revised IPO structure looks like:
| IPO Element | Original Plan | Revised Plan | Change |
|---|---|---|---|
| Total Size | $375.7M (₹3,100 Cr) | $308.3M (₹2,626 Cr) | -18% |
| OFS Component | 22 million shares | 11.1 million shares | -49.5% |
| Target Valuation | $1.5-2 billion | $1.4 billion | ≈-22% |
| Subscription Period | – | April 28-30, 2025 | – |
Fund Allocation & Market Position
The EV startup has outlined a clear roadmap for utilizing the fresh capital, with the largest portions going toward a new manufacturing facility in Maharashtra (₹927.2 crore), R&D initiatives (₹750 crore), and marketing campaigns (₹300 crore).
With a 10.7% market share in 2024 and unit sales reaching 126,353 (a 21% year-over-year increase), Ather has established itself as the fourth-largest player in India’s electric two-wheeler segment. Despite generating revenue of ₹15.79 billion ($185.4M) in the nine months ended December 2024, financial challenges persist with a net loss of ₹5.78 billion ($67.8M) during the same period – though this represents an improvement from the ₹7.76 billion loss recorded in the previous year.
The Competitive Landscape
The comparison with rival Ola Electric is particularly interesting. While Ola commands a much larger market share (34.1% in 2024), its post-IPO performance serves as a cautionary tale. After debuting with a record 20% surge – the biggest by an Indian firm in two years – Ola’s share price has since declined by nearly 42%.
Will Ather’s more conservative approach yield better results? Industry watchers are closely monitoring this space.
Key Stakeholder Movements
The revised filing indicates several important stakeholder decisions:
- Co-founders Tarun Mehta and Swapnil Jain will sell portions of their holdings
- National Investment and Infrastructure Fund Limited (NIIF) and Tiger Global Management’s Internet Fund III are also offloading stakes
- Hero MotoCorp, which owns over 40% of Ather, will retain its entire shareholding – a vote of confidence in the company’s future
Expert Analysis: What This Means for Investors
Are you considering investing in Ather’s IPO? Here’s what you should know:
- The reduced offer size suggests a more cautious approach, potentially indicating more realistic pricing
- Hero MotoCorp’s decision to hold its stake signals long-term faith in Ather’s growth prospects
- The improving loss profile (reducing by approximately 25% year-over-year) indicates progress toward profitability
- The Indian EV market continues to grow, with government initiatives supporting adoption
The Road Ahead for Ather Energy
As the first mainboard public offering of the 2025-26 financial year in India, Ather’s IPO will be closely watched by investors, industry peers, and market analysts alike. The company’s focus on building premium electric two-wheelers, coupled with its established presence in the charging infrastructure space, positions it uniquely in India’s EV ecosystem.
Will Ather’s cautious approach pay dividends in the long run? The coming weeks will tell us more, but one thing is clear: India’s electric mobility revolution is gaining momentum, and Ather Energy is determined to be at its forefront.
