Shares of Ather Energy will be listed at the bourses today. The company has fixed the IPO price at ₹321, at the upper end of the ₹304-321 price band. The IPO saw lacklustre interest, especially from high net worth individuals; as it was subscribed just 1.43 times. Being the first IPO of the current fiscal and from the electric vehicle segment, there has been a lot of buzz ahead of the issue opening.

Thanks to last day interest by  qualified institutional buyers (QIBs), the IPO sailed through. The quota allotted for QIBs was subscribed 1.7 times, while the non-institutional investors’ portion remained undersubscribed at 66 per cent.

However, employees of the company showed immense interest, as the quota reserved for them was subscribed 5.43 times, while the quota for retail investors was subscribed 1.78 times. 

Prashanth Tapse, Senior VP (Research), Mehta Equities Ltd, said:  “The final day subscription surge —particularly from Qualified Institutional Buyers (QIBs) — suggests 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.”

A flat listing seems to be justifiedas the issue was aggressively priced, especially when benchmarked against peer OLA Electric, whose post-listing performance has been underwhelming., he said adding: “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 concerns with new investors.”

From the proceeds, ₹927.2 crore will be allocated to setting up a new electric two-wheeler manufacturing facility in Maharashtra. An additional ₹750 crore is earmarked for investments in research and development, while ₹300 crore will be used for marketing initiatives. The company also plans to utilise ₹40 crore for debt repayment. Ahead of the IPO, the company mobilised ₹1,340 crore from anchor investors

“Given these facts, we recommend a “hold” only for high-risk taking investors, who are comfortable with short- to medium-term volatility, while conservative investors may prefer a wait-and-watch approach, allowing the stock to establish a more reasonable valuation post-listing,” Mehta said.

Industry being in the 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 the short to medium term investing, he further said.

Published on May 6, 2025