Hero MotoCorp Invests Rs 124 Crore in Ather Energy, Boosting Valuation by 20% to Rs 5,636 Crore
Hero MotoCorp, a big player in the two-wheeler industry, has invested Rs 124 crore into Ather Energy, an electric scooter manufacturer. This investment gives Hero MotoCorp an additional 2.2% stake in Ather, making its total shareholding in the company over 40%. Essentially, Hero is strengthening its hold on Ather, which was already its largest shareholder.
This new investment values Ather at Rs 5,636 crore, which is higher than the Rs 4,666 crore valuation from December last year when Hero invested Rs 140 crore. Hero didn’t specify which investor they bought the new shares from.
For the fiscal year 2024, Hero MotoCorp reported Ather’s turnover at Rs 1,753 crore, slightly down from Rs 1,784 crore in the previous year. However, they didn’t mention Ather’s losses for FY24, while in FY23, Ather had a net loss of Rs 864 crore.
This investment comes shortly after Ather raised Rs 286 crore (around $34 million) from its founders and Stride Ventures through a mix of debt and equity funding. Ather is also planning to raise $75-90 million (about Rs 750 crore) from new and existing investors, which might value the company between $850 million and $1 billion.
Flipkart cofounder Sachin Bansal, an early investor in Ather, sold a large part of his stake to Zerodha cofounder Nikhil Kamath and is looking to sell the rest. Bansal had invested nearly Rs 400 crore since 2014 and held 10.7% of the company. Another Flipkart cofounder, Binny Bansal, also holds a 1% stake in Ather.
Ather’s new round of funding follows a Rs 900 crore raise in September 2023 from Hero MotoCorp and GIC through a rights issue after postponing earlier funding plans due to poor market conditions. Ather competes with Ola Electric, TVS, and Bajaj in the electric scooter market.
On April 6, Ather launched a new range of ‘Rizta’ scooters aimed at families. Currently, Ather produces 150,000 scooters per year but plans to expand its production capacity to 450,000 scooters annually once the Rizta is released.
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