Mainboard IPO dry spell ends, Ather Energy to hit D-Street on Apr 28

The dry spell in the initial public offering (IPO) market is going to end soon as pure-play electric vehicle company Ather Energy is set to hit Dalal Street in the last week of April. The much-awaited IPO of the EV two-wheeler manufacturer will open for subscription between April 28-30, which is going to be the first and largest mainboard public issue of the financial year 2025-26.

Notably, this mainboard IPO comes after nearly two month, as Quality Power was the last company to list its shares on the domestic bourses – BSE and NSE - on February 24, 2025. Since then, not a single mainboard IPO has been launched, marking a complete standstill in primary market activity, a situation which was last witnessed in May 2023. Most of the companies delayed or paused their listing plans due to sustained market volatility, weak investor sentiment, and unfavourable valuations. 

After a blockbuster run in 2024, the calendar year 2025 started on a modest note, with just 10 mainboard IPOs making its debut on domestic bourses in the first two months, raising a total of ₹15,983 crore, up 23% over the ₹12,990 crore garnered during the same period in 2024. However, the IPO market has been at a standstill since February, as poor performance of listed peers amid sharp volatility in the secondary market, influenced by domestic and global uncertainties, including U.S. tariffs, weak corporate earnings, and lower than expected economic growth.

Ather cuts IPO size

In the backdrop of ongoing consolidation in the secondary market, Ather Energy has cut its IPO size, looking to raise around ₹2,626 crore through a fresh issue of shares. In the preliminary document filed with the SEBI, the company had proposed to ₹3,100 crore via fresh equities. The EV firm has also halved its offer for sale (OFS) size to 1.1 crore equity shares from 2.2 crore mentioned in the DRHP.

The Bengaluru-headquartered EV company is seen raising money at market valuation of ₹12,000 crore, down from ₹14,000 crore projected earlier, amid fragile market conditions and weak investor appetite.

Ather Energy filed its preliminary documents with the Securities and Exchange Board of India (SEBI) in September 2024, while it received approval in December 2024. Following the receipt of regulatory approval, the company was initially planning to go public in early 2025, but it deferred listing plan to April, as investors risk appetite remained weak due to volatility in the stock market.

Last week, Tarun Mehta and Swapnil Jain co-promoted Ather filed its revised draft red herring prospectus (DRHP) with the SEBI, for which it received approval this week.

Under the OFS, co-founders Tarun Mehta and Swapnil Jain and individual shareholders Amit Bhatia and Karandeep Singh will offload shares. Among  corporate shareholders, Caladium Investment Pte Ltd, National Investment and Infrastructure Fund II, Internet Fund III, 3State Ventures Pte., IITM Incubation Cell, and IITMS Rural Technology and Business Incubator will pare stakes via OFS.

The electric scooter startup, backed by investors including Hero MotoCorp, Sachin Bansal, Binny Bansal, Tiger Global, and the National Investment and Infrastructure Fund (NIIF), last year raised raised ₹600 crore in a funding round led by NIIF, valuing the company at $1.3 billion (around ₹10,900 crore).

As per the DRHP, the company proposes to utilise the net proceeds of the fresh issue towards funding of capital expenditure requirements for establishment of an electric two-wheeler factory in Maharashtra; investment in research and development; repayment or pre-payment, in full or part, of certain borrowings availed by the company; expenditure towards marketing initiatives; and general corporate purposes.

Established in 2013, Ather Energy designs and develops electric two-wheelers, battery packs, charging infrastructure, associated software and accessories as well as manufactures battery packs and assembles E2Ws in-house. In fiscal year 2024, it sold 109,577 E2Ws and was the third largest player by volume of E2W sales, as per CRISIL. It manufactures electric scooters including the Ather 450 Apex, Ather 450S, Ather 450X, Ather 450X Pro, and Ather Rizta.

The company’s current E2W portfolio comprises two product lines – the Ather 450 line, which caters to customers seeking performance scooters, and the Ather Rizta line, which is targeted at customers seeking convenience scooters for their family.

Axis Capital, HSBC Securities and Capital Markets (India) Pvt Ltd, JM Financial and Nomura Financial Advisory Securities (India) Pvt Ltd are the book-running lead managers to the issue. The equity shares are proposed to be listed on BSE and NSE.