Mumbai, May 5
Ather Energy is set to list on Indian stock exchanges on Tuesday, but signs from the grey market suggest a quiet debut for the EV firm.
The Bengaluru-based electric two-wheeler maker is seeing only a mild premium ahead of its listing, pointing to limited early enthusiasm from investors.
As of Monday, the grey market premium (GMP) for Ather shares stood at just Rs 7 above the IPO’s upper price band of Rs 321, indicating a potential upside of only around 2.18 per cent, according to InvestorGain.com.
This marks a noticeable drop from earlier expectations, as the GMP has steadily declined in the run-up to the listing.
The Rs 2,981 crore IPO received a relatively lukewarm response from investors across all categories. Overall, it was subscribed 1.43 times.
Retail investors subscribed 1.78 times, qualified institutional buyers (QIBs) 1.70 times, while non-institutional investors (NIIs) subscribed only 0.66 times.
However, the employee quota saw robust participation, with a subscription of 5.43 times.
Backed by global investors like Tiger Global, Ather Energy’s IPO opened for subscription between April 28 and April 30.
The allotment of shares was finalised on May 3, and shares were credited to investors’ accounts on Monday.
Refunds have also been issued for those who didn’t receive shares. The funds raised through the IPO will support Ather’s expansion efforts.
Approximately Rs 927.2 crore will go toward establishing a new EV manufacturing plant in Maharashtra.
The company is also investing Rs 50 crore in research and development, Rs 300 crore in marketing and brand building, and Rs 40 crore in debt repayment.
Meanwhile, despite being one of the early entrants in India’s EV sector, Ather has remained unprofitable since its inception in 2013 by Tarun Mehta and Swapnil Jain.
According to its red herring prospectus (RHP), the company has incurred losses every financial year, with no clear timeline for achieving cost efficiency or profitability.
— IANS
Reader Comments
Not surprised by the muted response. Ather makes great products but the EV market is getting crowded now with Ola, TVS, Bajaj all competing. Plus, their prices are still too high for mass adoption. Hope they use the IPO funds wisely to scale up and reduce costs. 🤞
As an Ather 450X owner, I can vouch for their quality and service. But the company needs to show a clear path to profitability. Investors are being cautious because burning cash for years isn't sustainable, no matter how good the product is. Maybe they should focus more on affordable models?
The Maharashtra plant is a smart move. EV adoption is growing fast in western India. But ₹300 crore for marketing? That seems excessive when word-of-mouth is working well for them. Better to invest more in charging infrastructure!
Long-term bet for sure! Indian EV market is still in early stages. Remember how Tesla struggled initially? Ather has first-mover advantage and strong R&D. The listing price doesn't matter as much as where they'll be in 5 years. 💡
Disappointed with the IPO response. Shows retail investors are becoming smarter - not falling for hype anymore. Why invest in a loss-making company when there are profitable auto stocks available? Ather needs to show concrete numbers, not just potential.
The employee subscription numbers tell the real story! 5.43 times oversubscribed means those who know the company best are bullish. Maybe we should follow their lead? 🚀 But yes, need to see more affordable models for wider adoption.
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