Electric two-wheeler manufacturer Ather Energy is set to value itself at as much as USD 2.4 billion in its upcoming initial public offering (IPO), people briefed on the matter said. That’s a premium of more than 80% over the last funding round in August, when it turned unicorn, they said.
Ather is expected to file its updated draft red herring prospectus (DRHP) later this month or the first week of February after sending final clarifications to the Securities and Exchange Board of India (Sebi), said the people.
In contrast to the series of new-age businesses’ listings last year that took a cautious approach to valuation, the likes of Ather and Bluestone are likely to price their offerings at a premium, reflecting their own plans as well as the competitive landscape.
Growing Market Share
“Ather will seek a valuation of USD 2.2-2.4 billion, according to current conversations,” said a person aware of the matter. Ather’s INR 3,100 crore (USD 360 million) proposal, the second electric vehicle (EV) startup IPO in the country after Ola Electric’s, has been cleared by Sebi. “Some minor updates are to be given; work is closing and (they) should be submitted soon,” the person said.
The company didn’t respond to queries.
Ather turned a unicorn at USD 1.3 billion valuation, following USD 71 million from existing investor National Investment and Infrastructure Fund (NIIF), ET was first to report on August 13.
What the IPO valuation also means is that Nikhil Kamath, Zerodha cofounder and a popular podcaster, will see one of the fastest value gains — in about six months — for his 5% stake to over USD 100 million.
He entered the Ather cap table by buying Flipkart cofounder Sachin Bansal’s holding last year. Kamath is estimated to have spent around USD 40 million for the stake in Ather, at a valuation lower than the unicorn round. “He is sitting on big gains already,” said another person aware of deal details.
Kamath has emerged as an active investor in India’s internet economy, with stakes in various early- as well as late-stage and IPO-bound startups. Subko Coffee and Bluestone are among his portfolio firms.
Hero MotoCorp, the largest investor in Ather with a stake of about 37%, is not selling any shares in the offer-for-sale (OFS) window and will be tagged as a co-promoter. Binny Bansal, another Flipkart cofounder, is also an investor in the EV maker and is part-selling his stake in the IPO. Tiger Global and GIC are other shareholders.
Mileage
Ather’s launches such as Rizta have boosted its overall sales, especially in the north and west. From around 6% market share last April, it ended 2024 with little over 14%, according to data from Vahan. In January, as of Sunday, it was at about 16% market share.
Meanwhile, Ola Electric has seen a fall in its market share, especially in December, when it lost its pole position to traditional automakers with EV offerings—Bajaj Auto and TVS Motor. Last month, Ola Electric’s market share fell under 20% for the first time. It had a market share of nearly 50% in May.
Rizta is the first scooter for the family segment, which has been dominated by Ola Electric. The Bengaluru-based firm’s Aurangabad plant will be used to manufacture the model. Ather’s flagship 450 series operates in the performance scooter segment.
“In Gujarat, Ather’s market share jumped to 25% in December as against 5% in July, making it one of the fastest growing markets for the firm. The company is expanding its experience centres, increasing charging grids and launching Gold Service centres for servicing,” said a person aware of Ather’s plans, adding that it has partnered with (battery and charging solutions company) Amara Raja for its new Aurangabad manufacturing unit.
Nine Indian startups went public in 2024. This year, the industry expects at least double that number to tap the public markets. “For many mid-stage startups, IPOs have become a fair alternative to going for another private round of funding,” a venture investor aware of the matter said.
Ola Electric, which made a stellar debut on the bourses, is trading below its issue price owing to various factors. The scrip closed on the BSE on Friday at INR 73.42.
