Ather Energy, a prominent Indian electric vehicle (EV) manufacturer, is set to launch its initial public offering (IPO) on April 28, 2025. Despite being a loss-making entity since its inception in 2013, the IPO is poised to deliver substantial returns for its founders.mint+1mint+1mint+2mint+2mint+2
Founders’ Windfall
The ₹2,981 crore IPO includes an offer for sale (OFS) component of nearly ₹355 crore. Founders Tarun Mehta and Swapnil Jain plan to offload a combined 19.60 lakh shares. Given the IPO’s price band of ₹304 to ₹321 per share, and considering their weighted average acquisition cost of ₹21.09 per share, the founders stand to gain approximately 1,422% on their investments. mint+4mint+4mint+4
Financial Performance
Ather Energy has consistently reported losses, with a loss before taxes of ₹1,059.7 crore in FY24, up from ₹864.5 crore in FY23. Revenue remained stagnant at ₹1,753.8 crore in FY24, compared to ₹1,780.9 crore in FY23. The company acknowledges in its red herring prospectus that there is no assurance of achieving profitability in the future. mint+3mint+3mint+3
Market Position
Despite financial challenges, Ather Energy holds an 11.5% market share in India’s EV two-wheeler segment, ranking third by volume. The IPO aims to raise funds to enhance manufacturing capabilities and invest in research and development. mint
Source (full link):
https://www.livemint.com/market/ipo/lossmaking-ather-energys-ipo-promises-1-400-returns-for-its-founders-11745402532767.html
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