Ahead of listing, Ather Energy bullish on driving past rivals in e2W market

The electric scooter maker cited nine-month performance as proof of strength amid rising EV competition

Electric scooter maker Ather Energy, which is set to open public subscription for its initial public offering (IPO) on Monday, April 28, is positioning itself to take on rivals in India’s highly competitive and price-sensitive electric two-wheeler market.

 

When asked how Ather plans to hold its ground against major players like Ola Electric, Bajaj, Hero MotoCorp and TVS Motor Company, Ravneet Phokela, chief business officer of Ather, pointed to the company’s performance over the past nine months as evidence of its resilience and competitive strength.

 

“We’re confident because we’ve proven we can compete, and compete hard, while continuing to innovate,” said Phokela during a press event on Saturday.

 

He noted that the market had seen intense challenges, including expanded distribution, deep discounting and aggressive pricing by the competitors. Despite these pressures, Ather Energy increased its national market share from 9 per cent to 15 per cent.

 

The company has grown significantly in Maharashtra and Gujarat. In southern India, where Ather already held a strong position, its presence further solidified, establishing the company as the market leader in the region.

 

Phokela emphasised that Ather’s strength lies in its product quality and innovation, but acknowledged the need to address gaps in distribution and scale. 

 

Founded in 2013 by Indian Institute of Technology (IIT) Madras alumni Tarun Mehta and Swapnil Jain, Ather recently crossed 200,000 units in cumulative sales, and in October 2024 alone, shipped more than 20,000 scooters—driven primarily by its family-focused Rizta model. Alongside the 450X, a performance-oriented flagship, the Rizta has allowed Ather to expand its market share and geographical footprint.

 

Ather Energy has set a price band of Rs 304-321 per share for its IPO. The firm is targeting a valuation of Rs 12,000 crore in its upcoming IPO, down from an earlier expectation of Rs 14,000 crore, according to people familiar with the matter.

 

The company raised Rs 1,340 crore from anchor investors on Friday, with a mix of marquee domestic and global institutions queuing up.

 

Ather filed its Red Herring Prospectus (RHP) with the Securities and Exchange Board of India (Sebi) on April 22, 2025. The IPO will include a fresh issue of Rs 2,626 crore and an offer for sale (OFS) of up to 1.1 crore equity shares by existing shareholders. While this is a reduction from the originally proposed Rs 3,100 crore and 2.2 crore shares, analysts view the recalibration as a pragmatic response to prevailing market conditions.

 

Despite market headwinds, Ather's financials suggest growing resilience. In the first nine months of FY25, the company trimmed its net loss to Rs 577.9 crore, down more than 25 per cent from Rs 776.4 crore in the corresponding period last year. Revenue from operations surged by 28.32 per cent year-on-year to Rs 1,578.9 crore, reflecting higher sales momentum post the launch of its more mass-market Rizta scooter.

 

In contrast, Ola Electric—Ather's closest peer and the only other pure-play EV original equipment manufacturer (OEM) in India—reported a net loss of Rs 564 crore for the third quarter (Q3) of FY25. Its revenue for the quarter fell 19 per cent year-on-year to Rs 1,045 crore. While Ola continues to lead in market share, Ather is narrowing the gap by building a distinct premium brand, according to industry sources.

 

International expansion

 

Ather Energy will continue to focus on premium consumer electric scooters and has no immediate plans to enter the business-to-business (B2B) or three-wheeler segment, chief executive officer (CEO) and co-founder Tarun Mehta said ahead of the company’s IPO.

 

“We’re a consumer brand,” Mehta said. “Our focus is on building a diverse scooter portfolio to meet evolving tastes as the market matures and premiumises.”

 

Mehta added that while motorcycles and international markets are on the long-term roadmap, the near-term priority is deepening domestic presence and expanding distribution.

 

The startup is also making inroads into Tier-2 and Tier-3 markets previously dominated by internal combustion engine (ICE) players. Mehta pointed to rising demand in Tier-3 cities. He said that electrification has taken off rapidly in smaller towns, in some cases even outpacing Tier-1 adoption. “What’s notable is that the demand isn’t just for EVs—it’s for premium, aspirational products.”

 

When asked whether Ather Energy plans to expand internationally or remain focused on deepening its presence in the domestic market, Phokela said the company is already present in Nepal and Sri Lanka, and sees clear potential for further international growth.

 

“There’s been incredible inbound interest over the past two to three years,” Phokela said.

 

R&D

 

Ather plans to deploy IPO proceeds to establish a new manufacturing facility in Maharashtra, enhance research and development (R&D) capabilities, retire debt and expand marketing efforts. The company has already launched a product testing and validation centre in Bengaluru.

 

Ather dedicates nearly half its workforce to R&D and holds over 170 global patents, more than 88 per cent of which are currently active. Its Draft Red Herring Prospectus outlines plans to allocate Rs 750 crore of IPO proceeds toward boosting battery technology, software capabilities and onboard intelligence systems.

 

This investment directly enhances the user experience. Riders get features like touchscreen dashboards, predictive maintenance, over-the-air updates and mobile integration. On the infrastructure side, Ather Grid now spans over 1,600 locations across India.

 

Vertical integration

 

Ather has an unorthodox yet sharply focused approach to vertical integration. Rather than spreading itself thin across the battery supply chain, the company has doubled down on owning product engineering and software development. It controls 80 per cent of its hardware and writes 100 per cent of its software in-house. The result is a cohesive, differentiated and nimble product development cycle—designed for speed, adaptability and long-term brand value.

 

“We’re bullish on vertical integration in design—it lets us add our unique touch and ensures higher product quality,” said Swapnil Jain, co-founder and chief technology officer (CTO) of Ather Energy.

 

At the same time, Jain said the company has avoided over-reliance on any single supplier. Over the past three years, Ather expanded its supplier base from around 120 to nearly 200. The aim was to enable dual sourcing, add geographic redundancy and build a more resilient supply chain.

 

Jain said Ather made a clear choice not to manufacture battery cells. The reason is scale—cell manufacturing is capital-intensive, and the two-wheeler EV market does not yet justify the investment. “It’s a space where we prefer to collaborate rather than integrate,” he said. 

 

China’s success

 

Mehta said India’s EV sector represents a rare opportunity for the country to lead with homegrown technology—a departure from its traditional role as a technology adopter. Citing China’s success in EVs and other advanced sectors, Mehta urged Indian companies to invest more in R&D, create local engineering talent pipelines and focus on long-term value creation. He pointed to Ather’s role in fast-tracking the development of an indigenous EV charging standard as an example.