Ather Energy a leading electric two-wheeler manufacturer in India, is preparing for its upcoming IPO, which is projected to be valued at an impressive $2.4 billion. This valuation marks an 80% increase from its last funding round in August when the company reached a $1.3 billion valuation.The company plans to raise $360 million through its IPO, becoming the second electric vehicle (EV) startup in India to go public after Ola Electric. Backed by strong market performance and significant investor interest, Ather Energy aims to capitalize on India’s growing electric vehicle market. With significant investments from Hero MotoCorp, Zerodha’s Nikhil Kamath, and other stakeholders, Ather’s expansion plans, including manufacturing, service, and market penetration, are well underway.
Introduction: Ather Energy and its IPO Strategy
Ather Energy offers the Ather 450X, 450 Plus, and the Rizta, catering to different market segments. It has also introduced a subscription model for services and charging stations, creating a complete EV ecosystem with charging infrastructure, experience centers, and a user app. This valuation surge showcases the company’s accelerated growth and the increasing demand for electric vehicles in India.
Ather Energy’s IPO is set to raise $360 million, positioning it as a major event in India’s electric vehicle startup scene. SEBI has already approved the company’s draft prospectus, with the offering expected to draw significant investor interest.. The IPO will be the second by an electric vehicle startup in India, following Ola Electric’s successful offering.
Ather Energy’s Business Model and Revenue Streams
Ather Energy operates with a hybrid business model focusing on both manufacturing and services. The company designs and manufactures electric scooters, known for their innovative design, high performance, and sustainability. Ather Energy offers the Ather 450X, 450 Plus, and the Rizta, catering to different market segments. It has also introduced a subscription model for services and charging stations, creating a complete EV ecosystem with charging infrastructure, experience centers, and a user app.
Funding Background and Founder Insights
Ather Energy was founded by Tarun Mehta and Swapnil Jain in 2013, both of whom were engineering students with a passion for clean energy and transportation. They sought to create a sustainable solution to the country’s growing pollution and fuel dependency. Tarun and Swapnil’s vision was to provide an alternative that combined technology with environmental responsibility.
The company raised its first round of funding in 2014 and has since attracted significant investments from various stakeholders. Notably, Hero MotoCorp, a leader in India’s traditional two-wheeler market, owns a 37% stake in the company and has been instrumental in its growth. Zerodha’s Nikhil Kamath is another key investor, having bought a 5% stake from Flipkart co-founder Sachin Bansal last year. With such strong backing, Ather Energy has positioned itself as a leader in India’s electric vehicle industry.
Ather Energy’s Growth Trajectory
Market Share and Sales Growth
Ather Energy’s market share has been growing exponentially. As of January 2025, the company holds 16% of the electric two-wheeler market, up from 6% in April 2024, driven by models like the Ather 450X and the family-friendly Rizta.
Ather expands not only its sales but also its infrastructure, including experience centers and charging stations. The company’s presence has grown significantly in northern and western India, where it now enjoys a larger market share. The rise of electric mobility, along with government incentives for EV manufacturers, has helped Ather Energy capitalize on the increasing demand for eco-friendly transportation solutions.
Strategic Partnerships and Future Expansion
Ather Energy has accelerated its growth by partnering with Amara Raja Batteries to set up a manufacturing facility in Aurangabad for the Rizta model. This collaboration underscores the company’s commitment to expanding its manufacturing capacity and ensuring the production of high-quality electric vehicles.
Additionally, Ather Energy has been increasing its service infrastructure with Gold Service Centers for servicing and charging grids. These efforts aim to provide a seamless experience for users, which is critical for retaining customers in the competitive EV market.
Ather Energy IPO: The Road Ahead
Ather Energy aims for a $2.4 Bn valuation in its IPO, which is expected to further boost its market dominance. The upcoming IPO will not only provide the company with substantial capital but also enhance its visibility among investors globally. Ather Energy’s decision to price its shares at a premium reflects its confidence in the growth prospects of the electric vehicle market and its long-term strategy.
IPO Details and Timeline
Ather Energy is gearing up to file its revised draft red herring prospectus (DRHP) with SEBI by the end of this month or early February. The $360 million IPO will fund product development, market expansion, and infrastructure scaling, attracting both domestic and international investors. The IPO also provides an opportunity for stakeholders like Nikhil Kamath and Hero MotoCorp to monetize their investments, while Hero has expressed that it won’t be selling any shares during the offer-for-sale (OFS) window.
Learning for Startups and Entrepreneurs
- Importance of Innovation: Ather Energy’s rapid rise in the electric vehicle sector highlights the significance of innovation in driving growth. Entrepreneurs can learn from Ather’s focus on designing user-centric products that solve real-world problems.
- Strategic Partnerships: The company’s ability to collaborate with established players like Hero MotoCorp and Amara Raja is a key factor in its success. Strategic partnerships help startups expand their reach and access critical resources.
- Scalability and Expansion: Ather’s ability to scale operations and expand into new markets is crucial for long-term growth. Startups should focus on building scalable business models that can adapt to market changes.
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