SUMMARY
- Ather Energy saw its operating income drop by 1.5% YoY to Rs 1,753.8 crore in FY24.
- Its net loss expanded by over 22% to Rs 1,059.7 crore.
- Ather’s overall spending reached Rs 2,674.2 crore from Rs 2,666.3 crore in FY23.
Two-wheeler EV startup Ather Energy saw its operating income drop by 1.5% YoY to Rs 1,753.8 crore in FY24 while its net loss expanded by over 22% to Rs 1,059.7 crore.
In FY23, Ather experienced an increase of 335% YoY in its operating income, reaching Rs 1,780.9 crore. This growth was mirrored by a similar increase in its net loss, expanding by 2.5 times YoY to Rs 864.5 crore.
According to the company’s financial statement submitted to the Securities Exchange Board of India (SEBI) for its IPO exceeding Rs 3,100 crore, Ather’s primary revenue source suffered due to a decrease in the government’s FAME subsidy.
Ather mentioned in its financial statement that the government’s decision to reduce benefits for EV manufacturers under its schemes could lead to increased costs for these manufacturers. For instance, a change in policy on May 19, 2023, by the Ministry of Heavy Industries, Government of India, reduced the cap on incentives for the FAME scheme from Rs 15,000 per kWh to Rs 10,000 per kWh, starting from June 1, 2023. This reduction in subsidies led to a rise in the retail prices of Ather’s electric two-wheelers, from Rs 20,434 to Rs 30,285, which in turn slightly decreased the company’s operating revenue.
Founded in 2013 by Tarun Mehta and Swapnil Jain, Ather Energy is a leading Indian manufacturer of electric two-wheelers. The company also produces its own battery packs and operates a charging network. Building its market presence on its 450 series of electric scooters, which includes the Ather 450S, Ather 450X, and Ather 450 Apex, Ather recently introduced a new line of scooters, the Rizta, and expanded into the smart helmet market.
The Ather 450X, with its three variants, was the most significant contributor to Ather’s revenue in FY24, accounting for Rs 1,283.8 crore. Specifically, the Ather 450X with a 2.9 kWh battery capacity brought in 9% of the total revenue, while the Ather 450X with a 3.7 kWh capacity contributed 31%. Rs 277 crore were sourced from Ather 450S and Rs 9.1 crore from Ather 450 Apex.
In FY24, Ather Energy sold 22,712 units of its Ather 450S, 86,315 units of the 450X, and 550 units of the Ather 450 Apex. The company’s sales of finished products, which include its electric scooters, saw an increase in FY24, while its sales of stock-in-trade, which includes EV-related accessories, spare parts, and merchandise, saw a significant decline of almost 76% YoY.
The electric vehicle (EV) major’s revenue from service offerings, which mainly comes from the Pro Pack, which includes Atherstack functionalities, three years of access to Ather Connect features, and an extended battery warranty, experienced a nearly 15% YoY decrease throughout the period under examination.
During FY24, Ather’s overall spending amounted to Rs 2,674.2 crore, showing a slight increase from the previous year’s total of Rs 2,666.3 crore.
The largest segment of Ather’s total spending was on materials, which saw a 2.7% YoY increase to Rs 1,579.2 crore in FY24.
This category includes the cost of raw materials and components that Ather purchases from its suppliers for scooter production. Additionally, the company outsources the production of components such as the chassis, battery management system (BMS), vehicle control unit, motor controller, and raw materials.
Ather’s total costs related to employee benefits rose by 10.3% to Rs 369.2 crore in FY24 compared to the previous year’s total of Rs 334.8 crore.
At the end of March 2024, Ather had 1,458 active employees and 996 former employees.
Ather’s spending on advertising and marketing fell by 55% to Rs 90.7 crore during the year under review, dropping from Rs 203.8 crore in the fiscal year 2023.
The company mentioned that this reduction in marketing activities was primarily aimed at optimizing marketing expenditures, anticipating a decrease in consumer demand due to the reduction of regulatory incentives under FAME-II.
Ather’s expenditure on research and development rose to Rs 236.5 crore in the fiscal year 2024 from Rs 191.6 crore in the fiscal year 2023.
According to Ather’s DRHP submitted on Monday (September 9), its initial public offering (IPO) will feature Rs 3,100 crore in new shares and an Offering for Shares (OFS) component of 2.2 million equity shares. Similar to Ola, Ather is preparing to go public as an entity operating at a loss with no definitive plan for profitability.
