Ather Energy Makes Tepid Debut On The Stock Market
Bengaluru-based electric scooter manufacturer Ather Energy commenced trading on the Bombay Stock Exchange (BSE) and National Stock Exchange (NSE) today, marking a significant milestone in India's electric vehicle (EV) sector. The company's shares listed at Rs. 328 on the NSE and Rs. 326.05 on the BSE, reflecting a modest premium of 2.18 per cent and 1.57 per cent, respectively, over the issue price of Rs. 321. Despite the initial uptick, Ather's stock experienced a downturn during the trading session, with prices dipping over 5 per cent to an intraday low of Rs. 308.95 on the BSE. This performance underscores the cautious sentiment prevailing among investors, particularly in the capital-intensive and competitive EV two-wheeler market.
The Rs. 2,981 crore (approximately $352 million) Initial Public Offering (IPO) was subscribed 1.43 times, driven by interest from Qualified Institutional Buyers (QIBs) and retail investors. However, the Non-Institutional Investors (NIIs) segment saw a subscription of only 66 per cent, indicating a tepid response from this category.
Ather's IPO proceeds are earmarked for several strategic initiatives, including the establishment of a new manufacturing facility in Maharashtra, investment in research and development, marketing efforts, and debt repayment. The company aims to enhance its production capabilities and expand its footprint in the burgeoning EV market, especially bolstering its production at its new manufacturing plant in Chhatrapati Sambhaji Nagar (Aurangabad) in Maharashtra, which will cater to the two new EL and Zenith EV platforms and have an annual capacity of almost a million units, with the current Hosur plant having a capacity of 4.5 lakh units per annum.
Founded in 2013, Ather Energy has been a pioneer in India's electric scooter segment, known for its technology-driven approach and premium offerings. However, it faces stiff competition from established players like Ola Electric, TVS Motor, and Bajaj Auto. The company's decision to proceed with the IPO, despite reducing its valuation by 44 per cent from initial expectations, reflects its commitment to long-term growth amidst market volatility.
Industry analysts suggest that Ather's future performance will hinge on its ability to scale operations, achieve profitability, and navigate the challenges inherent in the EV sector. The company's focus on innovation and infrastructure development will be critical in determining its trajectory in the competitive landscape.
As Ather Energy embarks on its journey as a publicly listed entity, stakeholders and investors will keenly observe its strategies and execution in the evolving electric mobility ecosystem, particularly in India.
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