India’s EV startup Ather cuts IPO size to $308M, seeking $1.4B post-money valuation

Ather Energy, the Indian startup manufacturing electric two-wheelers, has cut the size of its initial public offer by 18% to 26.26 billion Indian rupees ($308.3 million), according to a new draft prospectus filed Tuesday.

The Bengaluru-based startup confirmed to TechCrunch that it’s targeting a post-money valuation of $1.4 billion. Last September, the startup sought a valuation of between $1.5 billion and $2 billion, TechCrunch reported at the time.

Ather cited market conditions for trimming its IPO size and target valuation.

Existing Ather shareholders will sell 11.1 million shares, down from the 22 million shares mentioned in last year’s draft prospectus. Bidding for Ather shares will open for three days starting April 28; anchor investors are set to participate in a private placement on April 25.

Ather co-founders Tarun Mehta and Swapnil Jain, as well as National Investment and Infrastructure Fund Limited (NIIF) and Tiger Global Management’s Internet Fund III, plan to offload their stakes in the IPO, according to the draft prospectus. However, the Indian two-wheeler giant Hero MotoCorp, which owns over 40% of the startup, will not sell its shares.

Ather said it will use 9.27 billion Indian rupees ($108.8 million) from the net proceeds to set up an electric two-wheeler facility in Maharashtra. Another 7.5 billion rupees ($88 million) will be invested in research and development and 3 billion rupees ($35.2 million) in marketing initiatives. The startup will also use 400 million Indian rupees ($4.7 million) to repay its borrowings.

The startup saw a 21% increase in sales in 2024, reaching 126,353 units, according to government data. It commanded a 10.7% market share that year, per the CRISIL Report referenced in the draft prospectus.

Incorporated in 2013, Ather launched its first electric two-wheeler in 2018. The startup reported it generated 15.79 billion Indian rupees ($185.4 million) in revenue in the nine months ended December, with a net loss of 5.78 billion Indian rupees ($67.8 million) — down from 7.76 billion Indian rupees ($91.1 million) a year earlier.

Ather’s rival Ola Electric — which held a 34.1% market share last year — listed on the Indian stock exchanges last year. Ola debuted with a record 20% surge, the biggest listing by an Indian firm in two years. However, its share price has since declined by nearly 42%, closing at 53.02 Indian rupees Tuesday.