Ather Energy IPO: EV maker's shares make muted debut, list at 2% premium

Shares of pure-play EV company Ather Energy, the first mainboard IPO of FY26, made a subdued debut on the stock exchanges on Tuesday. The shares of the electric two-wheeler manufacturer got listed at ₹326.05 on the BSE with a market capitalisation of ₹12,144 crore, a premium of 1.57% over the initial public offering (IPO) price of ₹321. On the NSE, the auto stock kicked off trading at ₹328, up 2.18% over the issue price.

Meanwhile, the equity benchmarks Sensex and Nifty were trading flat, tracking mixed cues from global peers.

The debut of the Ather Energy IPO was lower than the Street's expectations as the stock was trading at a decent premium in the grey market. Ather Energy shares were commanding grey market premium (GMP) of ₹14 in the unlisted market, indicating the listing price to be around ₹335, up 4.36%.

The Ather Energy GMP had turned zero post IPO closure, after the issue received a muted response from investors. The premium had touched a peak of ₹17 on April 22, while it started sliding after that amid volatility in the secondary market and fading buzz for the EV maker’s public issue.

Analyst recommends “HOLD” only for high-risk taking investors

In a pre-listing view, Prashanth Tapse, Senior VP (Research), Mehta Equities, recommended a “HOLD” only for high-risk taking investors, who are comfortable with short- to medium-term volatility. On the other hand, conservative investors may prefer a wait-and-watch approach, allowing the stock to establish a more reasonable valuation post-listing, he said.

“Industry being in high growth–high competition and high cash burning segment, we will see high volatility both in business as well as in the price action, hence investors should be aware of risk in short to medium term investing,” he said in a note.

According to him, the final day subscription surge, particularly from qualified institutional buyers (QIBs), suggested a last-minute effort to support the issue amid fears of under-subscription. This points to a lack of broad-based enthusiasm and raises concerns about the IPO’s inherent demand quality. “As a result, we expect a flat to mildly negative listing, likely in the range of ±5% under the best-case scenario.”

Justifying his views, Tapse said the issue was aggressively priced, especially when benchmarked against peer Ola Electric, whose post-listing performance has been underwhelming. “We believe the electric two-wheeler (EV 2W) segment remains highly competitive and capital-intensive, with most players, including market leaders, struggling to achieve sustainable profitability and raising concern with new investors.”

Ather Energy IPO subscribed 1.5 times

The ₹2,981 crore IPO of Ather Energy, which opened for subscription between April 28-30, was subscribed 1.5 times on the final day of bidding after QIBs came to rescue on the last day of bidding. Investors applied for 76.7 milion equity shares worth ₹2,463.65 crore (at the upper end of price range of ₹304-321 per share), as compared to the offer size of 51.1 million shares. The issue received subdued responses on the first two days of bidding, with the IPO booking 0.17% on Day 1 and 30% on Day 2.

The portion reserved for QIBs was booked 1.76 times as they started bidding on the final day of the offer. The IPO received decent support from retail investors, as the quota reserved for them was subscribed 1.89 times, while that of non-institutional investor (NII) was booked just 69%. Meanwhile, employee’s quota received maximum bidding of 5.43 times. Ather had reserved up to 75% of the public issue for QIB, 15% for NII, and 10% for retail investors. The employee quota was reserved up to 100,000 equity shares, which will be offered at a discount of ₹30 per equity share.

Despite having a first-mover advantage, Tarun Mehta and Swapnil Jain co-promoted EV maker received a tepid response from investors, especially from NIIs as the quota reserved for them failed to fully subscribe, which can be attributed to various factors, including higher investment risks and capital lock-in.

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