After Ola Electric, e-scooter maker Ather Energy files for $536 million IPO

Indian electric two wheeler-maker Ather Energy has filed for a Rs 4,500 crore ($536.2 million) IPO at a valuation of $2.5 billion, a source with direct knowledge of the matter said on Monday, seeking to tap a red-hot stock market weeks after bigger rival Ola Electric went public.

Ather is selling new shares worth Rs 3,100 crore in the IPO, draft papers filed with the market regulator showed. Existing investors and some top shareholders, including co-founder and CEO Tarun Sanjay Mehta, are selling shares worth Rs 1,400 crore in the float, according to the source, who did not want to be identified as the details are confidential.

Ather did not immediately respond to Reuters' request for comment.

Ather makes electric scooters and competes with recently-listed Ola Electric. Indian bike-maker Hero MotoCorp, which is Ather's top shareholder with a 37.2 per cent stake, will not sell shares in the IPO.

The IPO is the latest in India's booming stock market that has attracted about 200 companies to raise more than $7 billion through IPOs so far this year, per LSEG data.

Market leader Ola Electric, which listed after a $734 million IPO on Aug.9, among India's biggest this year, more-than-doubled from its IPO price of Rs 76 before trimming some gains.

It was last trading 5 per cent lower at Rs 103.99.

Adoption of EVs is still low in India, but is on the rise as Prime Minister Narendra Modi's government promotes clean energy.

Ather said it will use proceeds from the IPO to establish an electric two-wheeler factory in India's Maharashtra state, and for research and development.

The company's loss widened for at least the second year in a row in fiscal 2024 to Rs 1,060 crore from Rs 864 crore a year earlier, per the prospectus.

Axis Capital, JM Financial, Nomura and HSBC are book-running lead managers for the issue.