Ather Energy, an Indian electric two-wheeler manufacturing startup, has reduced the size of its initial public offering (IPO) by 18% to 26.26 billion Indian rupees ($308.3 million), as outlined in a new draft prospectus filed on Tuesday.
The company, based in Bengaluru, has confirmed to TechCrunch its aim for a post-money valuation of $1.4 billion. Previously, in September, the startup had sought a valuation ranging between $1.5 billion and $2 billion.
According to Ather, the decision to adjust the IPO size and target valuation is due to current market conditions. Existing shareholders are set to release 11.1 million shares, a decrease from the 22 million shares indicated in last year’s draft prospectus. The bidding process for Ather shares will commence for a period of three days starting April 28, with anchor investors scheduled to engage in a private placement on April 25.
Ather’s co-founders, Tarun Mehta and Swapnil Jain, along with National Investment and Infrastructure Fund Limited (NIIF) and Tiger Global Management’s Internet Fund III, intend to sell their shares in the IPO, as per the draft prospectus. However, Hero MotoCorp, which owns over 40% of Ather, will retain its shares.
The startup plans to allocate 9.27 billion Indian rupees ($108.8 million) from the net proceeds towards establishing an electric two-wheeler facility in Maharashtra. Additionally, 7.5 billion rupees ($88 million) will be directed towards research and development, and 3 billion rupees ($35.2 million) will be invested in marketing activities. A further 400 million Indian rupees ($4.7 million) will be utilized to pay down existing debts.
Ather has experienced a 21% increase in sales in 2024, reaching 126,353 units, according to government data, securing a market share of 10.7% that year, as reported in the CRISIL Report mentioned in the draft prospectus.
Established in 2013, Ather introduced its first electric two-wheeler in 2018. The company reported a revenue of 15.79 billion Indian rupees ($185.4 million) for the nine months ending in December, alongside a net loss of 5.78 billion Indian rupees ($67.8 million), which marks a decrease from the 7.76 billion Indian rupees ($91.1 million) loss recorded the previous year.
Ather is in competition with Ola Electric, which held a 34.1% market share in the previous year and was listed on the Indian stock exchanges last year. Ola made its market debut with a notable 20% surge, marking the most significant listing by an Indian company in two years. However, Ola’s share price has subsequently fallen by approximately 42%, closing at 53.02 Indian rupees as of Tuesday.
