SUMMARY
- The Competition Commission of India approved NIIF’s plan to acquire additional Series G shares in Ather Energy under the green channel route, aiming to strengthen its position in the electric vehicle sector.
- Ather Energy is preparing for a $2.5 billion IPO, seeking INR 4,500 crore through a combination of a fresh issue and an offer for sale. The company is also valued at $1.3 billion following a recent funding round.
- Despite substantial growth and expansion, including new product launches and international ventures, Ather Energy reported a 22.5% increase in net loss to INR 1,059.7 crore in FY24.
The Competition Commission of India (CCI) has approved the National Investment and Infrastructure Fund’s (NIIF) proposal to acquire an additional stake in Ather Energy, a leading electric two-wheeler manufacturer. This approval was granted under the green channel route, which expedites the review process for mergers and acquisitions that comply with competition laws.
According to CCI’s order, the India-Japan Fund (IJF), a SEBI-registered alternative investment fund managed by NIIF, plans to purchase Series G Compulsorily Convertible Preference Shares of Ather Energy. The acquisition is aimed at bolstering IJF’s position in the electric two-wheeler market, promoting clean mobility solutions, and advancing technology-driven last-mile transport solutions.
The timing of this deal is significant as Ather Energy prepares for its initial public offering (IPO). The company is set to file its draft red herring prospectus (DRHP) with SEBI for an IPO valued at INR 4,500 crore, consisting of both a fresh issue and an offer for sale (OFS). The company targets a valuation of approximately $2.5 billion for the IPO.
Last month, Ather Energy entered the unicorn club following a funding round where it raised INR 600 crore ($71 million) from NIIF, bringing its post-money valuation to $1.3 billion. This followed a debt funding round of INR 60 crore ($7.1 million) from InnoVen Capital. Hero MotoCorp, led by Pawan Munjal, remains a significant investor in Ather, holding a 40.89% stake.
Ather Energy, founded in 2013 by Tarun Mehta and Swapnil Jain, manufactures electric scooters and battery packs and operates its own charging infrastructure. Recently, it launched the Rizta family scooter series and expanded into smart helmets. The company also announced plans for a third manufacturing facility in Maharashtra and has begun operations in Sri Lanka.
Despite its rapid growth and expansion, Ather Energy remains a loss-making entity. In FY24, its net loss increased by 22.5% to INR 1,059.7 crore. As of August, Ather Energy ranked fourth in the electric scooter market in India, with 10,873 vehicle registrations, reflecting a 52% year-on-year growth.
