On April 28, Ather Energy's IPO Expected to Boost Markets

Ather Energy, a manufacturer of electric vehicles, has established a price range of IR 304–321 per share for its April 28 IPO. The issue will close on April 30 after anchor bidding begins on April 25. According to its prospectus, the Tiger Global-backed company has scaled back its initial public offering.

Instead of raising INR 3,100 crore as planned, it intends to raise INR 2,626 crore through the issuance of additional shares. Along with the new issuance, the IPO also included an Offer for Sale (OFS) of 1.1 crore equity shares, in which institutional investors and the promoter group will participate.

 Along with other corporate owners, promoters Tarun Sanjay and Swapnil Babanla would sell a portion of their holdings under the OFS.

How Company Plans to Utilise Proceeds?

According to a media report, Ather Energy has lowered its initial projection of INR 14,000 crore to aim for a post-money valuation of INR 12,800 crore. In addition to funding its new facility in the western state of Maharashtra, the business intends to use the earnings from the initial public offering (IPO) for marketing, debt repayment, R&D, and other corporate needs.

Hero MotoCorp holds a 40% stake in Ather, making it the largest stakeholder. Apart from that, Tiger Global owns 6.56%, while the National Investment and Infrastructure Fund (NIIF) owns 14.22%. Mehta and Jain, co-founders of Ather, each own 6.81% of the company.

Hero remained steadfast in its decision to not sell its stock in the IPO. Electric scooters, battery packs, charging infrastructure, and related software systems are all designed, developed, and assembled in-house by Ather Energy, an electric two-wheeler (E2W) company.

Two product lines, the Ather 450 and the Ather Rizta, each with seven variations, make up its electric two-wheeler range.

More Details of the IPO

Investors must deposit a minimum of INR 13,984 to be eligible for at least one lot, which consists of 46 shares. The RHP further stated that 10% of the offer is for ordinary investors, 15% is for non-institutional investors (NIIs), and 75% is for qualified institutional buyers (QIBs) due to book-building concerns.

Tiger Global will sell 400,000 equity shares as part of the offer for sale. The shares were purchased at an average price of INR 38.58 each, which represents an 8.3-fold return on investment. Comparably, National Investment and Infrastructure Fund II is expected to generate a 74% return on its investment through the OFS, while Caladium Investment is expected to generate a 57% return.

The Ather Energy IPO's book running lead managers are Axis Capital, HSBC Securities & Capital Markets, JM Financial, and Nomura Financial Advisory and Securities (India), while the registrar is Link Intime India.

While the firm will be listed on the BSE and NSE with a tentative listing date set for May 6, the allocation for the Ather Energy IPO is anticipated to be finalised on May 2. After Ola Electric's 2024 IPO, Ather Energy will be the second pure-play Indian EV maker to go public.