Ather Energy, one of India's leading electric two-wheeler (E2W) manufacturers, is set to launch its IPO in April 2025. The company, known for its innovative approach to the electric vehicle sector, is offering shares to the public through a book-built issue. The IPO aims to raise ₹ 2,980.76 Crores, with ₹ 2,626.00 Crores coming from the fresh issue of shares and ₹ 354.76 Crores from an offer for sale (OFS). Here’s a comprehensive guide to the details of the IPO, including its price band, subscription dates, financial performance, and more.

Ather Energy IPO Overview:

The Ather Energy IPO will open for subscription on April 28, 2025, and will close on April 30, 2025. The allotment is expected to be finalized by May 2, 2025, and the shares will be listed on the BSE and NSE on May 6, 2025. The price band for the IPO has been set at ₹ 304 to ₹ 321 per equity share, with a lot size of 46 shares.

Financial Highlights:

Ather Energy’s market capitalization at the IPO price of ₹ 321 per share is expected to be ₹ 11,955 Crores. The company's revenue has shown growth over the past few years, with an increase in operational income from ₹ 4,138.00 Lakh in FY 2022 to ₹ 16,174.00 Lakh in FY 2024.

However, despite this growth, Ather Energy has posted negative earnings before interest, taxes, depreciation, and amortization (EBITDA) in all fiscal years, reflecting the challenges that the company faces in the highly competitive and capital-intensive electric vehicle market.

IPO Details:

• IPO Size: ₹ 2,980.76 Crores

• Fresh Issue: ₹ 2,626.00 Crores (818.06 Lakh Shares)

• Offer for Sale (OFS): ₹ 354.76 Crores (110.51 Lakh Shares)

• Price Band: ₹ 304 to ₹ 321 per share

• Market Capitalization at IPO Price: ₹ 11,955 Crores

• Lot Size: 46 shares (minimum investment ₹ 14,766 for retail investors)

• HNIs Minimum Investment: ₹ 2,06,724 (14 lots)

The IPO is being managed by leading investment banks including Axis Capital, HSBC Securities, JM Financial, and Nomura. MUFG Intime India Private Limited will act as the registrar for the issue.

Grey Market Premium (GMP):

As of April 23, 2025, the Grey Market Premium (GMP) for Ather Energy IPO stands at ₹ 0, indicating no expected listing gains. The GMP reflects unorganized trading outside the formal market, and its lack of significant movement could indicate a lack of speculative activity surrounding the IPO.

Objectives of the IPO:

The company aims to use the proceeds from the IPO for several key initiatives:

1. ₹ 9,272.00 Million will be allocated to capital expenditure for setting up a new E2W factory in Maharashtra.

2. ₹ 400.00 Million will be used for the repayment or pre-payment of borrowings.

3. ₹ 7,500.00 Million is earmarked for investment in research and development.

4. ₹ 3,000.00 Million will go towards marketing initiatives.

5. The remaining funds will be allocated for general corporate purposes.

Ather Energy Financial Performance:

Despite Ather Energy's innovative product line and strong market presence, its financials reveal that the company has been operating at a loss. The Profit after Tax (PAT) has been negative for the past three fiscal years, with a loss of ₹ 5,779.00 Lakh in FY 2024. This indicates that the company is still in the growth phase and might face challenges in reaching profitability in the short term.

For FY 2024, the company posted a pre-issue EPS of ₹ -47.00 and a post-issue EPS of ₹ -28.45, reflecting the heavy capital expenditures involved in scaling its operations. The P/E ratio (pre-issue) is -6.83x, which, when compared to the industry P/E ratio of 39x, suggests that Ather Energy is priced low relative to the sector.

Ather Energy IPO Allotment Process:

Investors looking to check the allotment status of Ather Energy IPO can do so through the registrar’s website. Here’s a step-by-step guide:

1. Go to the IPO allotment status page.

2. Select Ather Energy Limited IPO from the dropdown list.

3. Enter your application number, PAN, or DP Client ID.

4. Submit the details to view the allotment status.

The allotment process will be live on May 2, 2025, and investors can expect the allotment status to be updated on the registrar’s website shortly after the finalization.

Conclusion & Recommendations:

While Ather Energy is a prominent player in the Indian electric two-wheeler market, its financials indicate a loss-making business. Given the negative profitability and the absence of GMP activity, we recommend investors to avoid this IPO if they are looking for listing gains. Furthermore, considering the company’s focus on capital expenditures and R&D, long-term investments may be risky unless Ather Energy shows significant progress towards profitability.

Investors should assess their risk appetite before considering this IPO.

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