Lacklustre Debut! Ather Energy share price lists 2% higher at ₹328 on NSE
On the NSE, Ather Energy share price on listing was ₹ 328, a premium of 2.18%. Meanwhile, on the BSE, Ather Energy shares debuted at ₹ 326.05, up 1.57%.
The listing was lower than what the grey market signalled, as ahead of the stock market debut, Ather Energy IPO GMP today was ₹ 14. This indicates that in the grey market, Ather Energy shares were trading at ₹ 335 apiece, a premium of 4.36%.
Ather Energy shares, meanwhile, reversed listing gains and traded in the red around 10.20 am. On the NSE, Ather Energy share price was down 1.33% from its listing price at ₹ 323.65, while on the BSE, the stock dipped 0.8% to ₹ 323.45.
Ather Energy IPO, which was open for subscription from April 28 to April 30, witnessed a modest demand for its issue. The IPO of the electric vehicle (EV) manufacturer was subscribed 1.50 times at the end of the three-day bidding period, amid strong buying demand from retail investors and qualified institutional buyers. Meanwhile, the non-institutional investor portion wasn't fully booked.
The QIB portion was subscribed 1.76 times, the NII portion 0.69 times and the retail investor portion 1.89 times. The employee portion was booked 5.43 times as of April 30.
The company raised ₹ 2,981.06 crore at the upper end of the price band of ₹ 321 apiece. The IPO was a mix of fresh share sale of ₹ 2,626.30 crore and an offer for sale by promoters and other selling shareholders of ₹ 354.76 crore.
Ather Energy plans to use the funds raised from the IPO's fresh issue for various purposes like capex for the establishment of an E2W factory in Maharashtra, repayment of certain corporate borrowings availed by the company, investment in R&D and for marketing initiatives or other general corporate purposes.
Ather Energy is a pure-play EV company that sells E2Ws and the associated product ecosystem, comprised of its software, charging infrastructure and smart accessories.
The company was founded in 2013 by Tarun Sanjay Mehta and Swapnil Babanlal Jain. It has a market share of 11.5% as of the financial year 2024 (FY24) and is the third-largest player by volume.
However, despite being a prominent brand in the EV two-wheeler market, the company has consistently incurred losses since its inception.
Ather, in its RHP, said that it has incurred losses since its incorporation and had stagnant revenue growth in FY24. "There is no assurance that we will be cost-effective in our operations or achieve profitability in the future," according to the company's RHP.
In FY24, Ather's loss before taxes amounted to ₹ 1059.7 crore, significantly higher than ₹ 864.5 crore in FY23 and ₹ 344.1 crore in FY22. It also had stagnant revenue growth in FY24 as it posted a revenue of ₹ 1753.8 crore compared with ₹ 1780.9 crore in FY23.
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