Battery transition, better EBITDA margins: Ather lays out path to profitability ahead of IPO

Ather Energy Co-founder and CEO Tarun Mehta on Saturday said the company will continue to improve its EBITDA margins on the back of rising volumes, driven by the Ather Rizta model as the electric vehicle-maker gears up to ring the bell on Dalal Street.

The Ather Rizta, the company’s second model that commenced deliveries in May 2024, has contributed “in a very big way towards volumes, driving a lot of growth,” Mehta said in a press meet.

Ather also stressed its promising adjusted gross margin, which increased from 9% in the six months ended December 31, 2023, to 19% in 2024. Additionally, the company has narrowed its EBITDA loss margin to 23% in the six months ended December 31, 2024, from 34% in the previous year.

These factors, along with favourable unit economics on the back of its rising sales volume and growing product portfolio, are expected to contribute significantly to the company’s path to profitability.

The HeroMoto Corp-backed company managed to reel in its losses for the nine months ended December 31, 2024, at Rs 577.9 crore compared to Rs 776.4 crore in 2023.

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Additionally, the company is also transitioning to cheaper LFP batteries compared to traditional NMC batteries, as well as to a lower-cost EL Platform for its scooters, which will help improve its margins, according to Mehta.

Ather Energy is the second EV-maker to list on public bourses after its rival, the Bhavish Aggarwal-led Ola Electric, made its debut last year.

Ather Energy will offer shares in the price band of Rs 304 to Rs 321 per equity share in its initial public offering, which will open on April 28. The offering will include a fresh issue of Rs 2,626 crore and an offer for sale of up to 1.1 crore shares. At the upper price band of Rs 321, the offer for sale would be worth about Rs 354.76 crore.

The EV-maker is valued at Rs 11,956 crore at the higher end and Rs 11,322 crore at the lower end.

The Tiger Global-backed company on Friday disclosed that it had raised Rs 1,340 crore from anchor investors.