EV Unicorn Ather Energy Receives SEBI Approval for Ather’s 3,100 Cr IPO

All decks are cleared for Ather Energy’s public listing, as the Securities and Exchange Board of India (SEBI) has approved the electric vehicle (EV) maker’s initial public offering (IPO).

Mehta and Jain founded Ather in 2013 to design and manufacture electric two-wheelers and battery packs. It also owns and operates the charging infrastructure. Earlier this year, the EV powerhouse joined the unicorn club by raising INR 600 crore from its existing investor NIIF at a post-money valuation of $1.3 billion.

According to the SEBI website, Ather received an observation letter from the market regulator on December 23. In SEBI language, the issuance of an observation letter indicates permission for the public offering.

With all necessary permits in place, the Bengaluru-based firm is expected to become the country’s second EV maker to list on the bourses, following Ola Electric.

Ather’s IPO proceedings began in June 2024, after it became a public limited company. In September, the electric two-wheeler firm filed a draft red herring prospectus (DRHP) for an IPO for more than INR 3,100 crore.

Related: Ather Energy Is Now India’s Latest Unicorn, Secures $71 Mn Fresh Funds

The planned public offering will consist of a new issuance of shares worth INR 3,100 crore and an offer for sale (OFS) of up to 2.2 crore shares.

Tiger Global, Caladium Investments, National Investment and Infrastructure Fund (NIIF), Binny Bansal’s 3 State Ventures, and co-founders Tarun Mehta and Swapnil Jain will sell their holdings through the OFS. However, Ather’s largest shareholder, automaker Hero MotoCorp, with a 37.2% interest, would not engage in the OFS component.

The original equipment manufacturer (OEM) was apparently planning an IPO with a valuation of roughly $2.5 billion. Ather intends to use the revenues from the public offering to support R&D, marketing initiatives, infrastructure, manufacturing projects, and general business purposes.

According to the DRHP, Ather wants to raise INR 620 crore through a pre-IPO placement. If such a placement is carried out, the amount will be subtracted from the overall fresh issue size.

From January to November 2024, Ather sold 1.07 lakh EV two-wheelers.

On the financial front, Ather’s consolidated net loss increased by more than 22% to INR 1,059.7 crore in fiscal year 2023-24 (FY24) from INR 864.5 crore in the previous year. During the fiscal year under review, revenue from operations fell by a minor 1.5% year on year (YoY) to INR 1,753.8 crore.

The IPO permission comes months after rival Ola Electric registered on the stock exchange and raised INR 6,145.6 crore at a valuation of $4 billion. The Bhavish Aggarwal-led company made a quiet public debut, with its shares trading at INR 75.99 each on the BSE, compared to its IPO issue price of INR 76.

However, Ather’s decision to list on the bourses comes at a time when an increasing number of new-age technology companies are flocking to the stock exchanges. In 2024, 13 such companies went public, raising more than INR 29,000 crore.

Meanwhile, over 20 new-age digital businesses, including category leaders such as Infra. Market, Ola Consumer, boAt, and OfBusiness, have set their sights on a D-Street IPO in 2025.