Bengaluru-based electric two-wheeler maker Ather Energy is set to raise Rs 2,981 crore through an initial public offering (IPO) next week, aiming for a valuation of around Rs 12,000 crore. The Hero Motocorp-backed firm’s IPO will break a nine-week dry spell in the primary equity market and follows rival Ola Electric’s IPO in August last year.
Ather’s public issue comes at a time when India’s electric two-wheeler (E2W) market is consolidating rapidly in favour of legacy players like , TVS Motor, and Hero Motocorp—where EVs make up only a small fraction of overall sales.
Ola, a pure EV player, saw its market share dip from 34 per cent to 30 per cent in FY25 as it ceded ground to Bajaj and TVS, while continuing to post losses. Ather held steady at 11.6 per cent market share, making it the fourth-largest player in the country, with sales concentrated in South India.
The proceeds will be used to build a new manufacturing facility in Maharashtra (Rs 927 crore), fund R&D (Rs 750 crore), and support marketing efforts (Rs 300 crore).
In FY25, the top five players in India’s E2W market—Ola, TVS, Bajaj, Ather, and Hero—together accounted for 86 per cent of total vehicle registrations, up from 79 per cent the previous year, reflecting a sharp rise in market concentration.
Bajaj, buoyed by its Chetak electric scooter range, nearly doubled its share from 11 per cent to 20 per cent. TVS edged up from 20 to 21 per cent, driven by its iQube lineup. Hero’s Vida scooters helped the company double its market share from 2 to 4 per cent, according to data from market intelligence firm JMK Research.
This consolidation has coincided with strong overall growth in the segment, still supported by government subsidies. E2W registrations touched around 12 lakh units in FY25, a 20 per cent increase from FY24. EV penetration in the two-wheeler category also rose, from 5.2 per cent to 6 per cent, and E2Ws now account for over half (55 per cent) of all EV registrations in India.
Still, for legacy manufacturers, electric models account for only a small share of their overall two-wheeler sales—11 per cent for Bajaj and 8 per cent for TVS, according to JMK. And, with strong brand equity and healthy cash flows from other segments, they are better placed to navigate the evolving market. For pure-play EV firms like Ola and Ather, the challenge will be holding on to market share as competition intensifies.
To stay competitive, Ather is doubling down on better technology and brand visibility. Of the Rs 2,981 crore it plans to raise through its IPO, the company will channel Rs 750 crore into R&D and Rs 300 crore into marketing.
In FY24, Ather spent 13 per cent of its revenue on R&D—led by a team of over 700 on-roll employees, including design engineers, research scientists, industrial designers, data scientists and others.
A key R&D priority for Ather going forward will be to develop an electric motorcycle platform, a segment the company sees as both underserved and promising. This will add to its existing Rizta and 450 series of scooters.
“Additionally, we will work on leveraging technological advancements across various platforms such as powertrain, battery and software and electronics in our products to make our products more appealing to customers while improving our unit economics,” Ather said in its final red herring prospectus (RHP) filed with market regulators on April 22.
The company is also evaluating a new battery platform based on lithium iron phosphate (LFP) chemistry, which is less mineral-intensive and could bring down costs compared to its current use of nickel manganese cobalt (NMC) batteries. In parallel, Ather is exploring motor technologies that do not rely on rare-earth metals or magnets—aiming to cut costs and insulate its supply chain from geopolitical shocks.
From the IPO proceeds, Ather will allocate Rs 927 crore to set up a new E2W factory in Maharashtra’s Chhatrapati Sambhaji Nagar district, which, along with its existing Hosur facility, will nearly triple production capacity. While the Maharashtra plant could help Ather expand in the northern and western markets—where it has less of a stronghold—utilisation at its Hosur unit remains modest, at just 40 per cent.
Unlike Ola, which is building in-house lithium-ion cell manufacturing capabilities, Ather has no such plans.
“We manufacture battery packs in-house using lithium-ion cells procured from suppliers and outsource the manufacturing of all other vehicle components… to third-party suppliers,” the company stated in its RHP.
Barring the lithium-ion cells sourced from China and South Korea, Ather claims significant local value addition through domestic suppliers. Complying with local content norms is critical for securing subsidies under the Centre’s Electric Mobility Promotion Scheme (EMPS). In FY24, subsidies accounted for 16 per cent of Ather’s revenue from operations.
“Reduction, elimination or ineligibility for government incentives… could reduce the demand for E2Ws and potentially result in us becoming less price competitive compared to conventional ICE 2Ws,” the RHP noted.
Ather’s IPO, opening April 28, comprises a fresh issue of 8.18 crore shares worth Rs 2,626 crore and an offer for sale of 1.11 crore shares worth Rs 354.76 crore. The company is targeting a valuation of Rs 12,000 crore—roughly half of Ola Electric’s current market cap of Rs 23,200 crore. The outcome of Ather’s offering is likely to influence the timing of competitor Greaves Electric Mobility’s IPO, which filed its draft RHP in December.
In the first nine months of FY25, Ather reported Rs 1,579 crore in revenue from operations—a 28 per cent increase year-on-year—while losses narrowed by 25 per cent to Rs 578 crore.
