Revenue stagnant, losses mount as EV firm Ather Energy prepares for IPO

New Delhi, April 25 The electric two-wheeler maker Ather Energy is set to launch its initial public offering (IPO) on April 28, but industry experts on Friday raised eyebrows over the company’s continued losses and lack of revenue growth.

Despite being one of the early players in India’s EV space, Ather has never reported a profit since it was founded in 2013 by Tarun Mehta and Swapnil Jain.

The company’s red herring prospectus (RHP) states that it has been making losses every year and there is no certainty about becoming cost-effective or profitable anytime soon.

In the financial year 2023–24, Ather Energy reported a pre-tax loss of Rs 1,059.7 crore. This is a sharp increase from its Rs 864.5 crore loss in FY23 and Rs 344.1 crore in FY22 -- showing a widening gap in its financial performance.

At the same time, its revenue in FY24 stood at Rs 1,753.8 crore, slightly lower than the Rs 1,780.9 crore it posted in FY23.

The upcoming IPO, worth Rs 2,981 crore, includes an offer for sale (OFS) of shares worth Rs 355 crore. Ather’s co-founders will offload 19.6 lakh shares, gaining huge returns.

Their average cost of acquiring shares was just Rs 21.09 per share. If the IPO is priced at the upper end of the Rs 304-321 band, they are set to earn gains of over 1,400 per cent -- even though the company itself is not making money.

Despite being one of the first to launch electric scooters in India back in 2018, Ather lags behind bigger rivals like Ola Electric -- which itself is facing headwinds in the market.

Ather’s IPO will remain open for subscription till April 30. The shares will be listed on the Bombay Stock Exchange (BSE) and NSE.

However, the company’s struggle to grow amid fierce competition raises serious questions about its business model and future.

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