Ather Energy IPO Day 2: Check subscription status, GMP, allotment date & more

The initial public offering (IPO) of Ather Energy continued to attract a muted response from the investors during the second day of the bidding process from all the categories of the bidders. The issue, which opened on Monday, April 28, was subscribed only 16 per cent on day one.

Ather Energy is selling its shares in the price band of Rs 304-321 apiece. Investors can apply for a minimum of 46 shares and its multiples thereafter. It is looking to raise Rs 2,981 crore via IPO, which included a fresh share sale of Rs 2,626 crore and offer-for-sale (OFS) of up to 1,10,51,746 equity shares by its promoters and existing shareholders.

According to the data, the investors made bids for 1,50,90,162 equity shares, or 28 per cent, compared to the 5,33,63,160 equity shares offered for the subscription by 5.00 pm on Tuesday, April 29, 2025. The three-day bidding for the issue shall conclude on Wednesday, April 30.

The allocation for retail investors was subscribed 1.12 times, while the portion reserved for non-institutional investors (NIIs) saw a subscription of 27 per cent. Portions allocated towards employees were booked 3.18 times. However, the quota set aside for qualified institutional bidders (QIBs) was yet to see any bids as of the same time.

Incorporated in 2013, Bengaluru-based Ather Energy is a pure-play electric two-wheeler (E2W) company engaged in the design, development, and in-house assembly of electric scooters, battery packs, charging infrastructure, and supporting software systems. It operates as a vertically integrated EV manufacturer with a focus on product and technology development.

The grey market premium (GMP) of Ather Energy has seen a sharp correction on the back of dull bidding for the issue and dented market sentiments. Last heard, the company was commanding a premium of merely Rs 1-2 per share in the unofficial market, suggesting a flat listing for the investors. The GMP stood around Rs 5 before the issue kicked-off for bidding.

Brokerage firms mostly have a mixed view on this issue. They suggest avoiding the issue citing its rich valuations, loss making nature of the business, high debt and rising competition in the EV space. However, others suggest subscribing to it on a long-term basis citing its expansion plans, rising penetration of EVs and profitability plans in the coming quarters.

Ather 'Rizta' and to be launched 'EL platform' are expected to play a pivotal role in solidifying its market position, the company’s future depends on ramp-up of vehicle volumes from existing and new product launches, gross margin improvement led by further cost reduction, and the ability to withstand competitive pressures from both E2W and ICE 2W OEMs, said DR Choksey Finserv.

"Ather Energy is well-placed to capitalize growth in the E2W Industry led by strong DNA of innovation and engineering, but the path to profitability seems long and full of challenges. Ather is currently offered at a EV/Sales valuation of 6 times, which appears overvalued to us. We assign a 'avoid' rating and believe that it can be bought at an attractive valuation in the secondary market," it said.

Ather Energy has reserved 1,00,000 equity shares for its eligible employees who will get a discount of Rs 30 per share during the IPO. 75 per cent of the net issue has been reserved for qualified institutional bidders, while 15 per cent of the net offer shall go to the non-institutional bidders. Only 10 per cent of shares from the net issue shall be allocated to the retail investors.

Ather Energy has not got benefits under the Production Linked Incentive (PLI) scheme, ensuring margin stability despite potential regulatory changes, said Canara Bank Securities. "Due to uncertainty surrounding the timeline for achieving profitability, we recommend a 'neutral' rating for the IPO. Investors with a long-term EV play may consider the opportunity," it said.

For the nine months ended on December 31, 2024, Ather Energy reported a net loss of Rs 577.9 crore, with a revenue of Rs 1,617.4 crore. The company's net loss stood at Rs 1,059.7 crore with a revenue of Rs 1,789.1 crore in the financial year 2023-24. Its total borrowing stood at Rs 1,121.6 crore as of December 31, 2024.

JM Financial, Axis Capital, HSBC Securities & Capital Markets, Nomura Financial Advisory and Securities (India) are the book running lead managers of the Ather Energy IPO, while Link Intime India is the registrar for the issue. Shares of Ather Energy shall be listed on both BSE and NSE with May 6 as the tentative date of listing, with allotment likely to be out by Friday, May 02.