Ather Energy IPO: GMP Remains Flat, Issue Receives Weak Response – All Details Here

The subscription for Ather Energy IPO on Day 2, April 29 received weak response from investors. As of 2:11 pm, investors placed bids for 1,28,72,594 equity shares against 5,33,63,160 shares on offer, meaning that only 24% of the issue was subscribed.

Retail investors subscribed the issue by 1.01 times, while NIIs booked for 19% of the shares allotted to them. QIBs subscribed for only 6,992 shares against the 2,89,27,363 shares reserved for them.

IPO details

The IPO is a combination of fresh issue and an offer for sale (OFS) equalling 8.18 crore and 1.1 crore equity shares. The price band of the issue has been fixed between ₹304–₹321 per share, consisting of a lot size of 46 shares.

GMP

As per the sources, the unlisted shares of Ather Energy were trading at ₹322.50 per share in the grey market, with a grey market premium (GMP) of ₹1.50 or 0.47.

What did brokerages say?

Arihant Capital

The brokerage has given 'Subscribe for listing gain' on the issue. According to them, the company is strongly positioned as India’s fastest growing electric two-wheeler market. In a research note the company said, “The company’s recent launches, like the Ather Rizta, have helped expand its customer base. Its upcoming Factory 3.0 will significantly increase production capacity from 420,000 to 1.42 million units by FY27, while ongoing cost-cutting and R&D investments are expected to improve margins further.”

Though reduction of government subsidies has been a challenge, the company has managed to improve its profitability metrics. “At the upper band of ₹ 321, the issue is valued at an EV/sales ratio of 8x, based on a 9MFY25 Sales of ₹ 1578.9 crore. We are recommending a 'Subscribe for listing gain' rating for this issue.”

Geojit Financial Services

Analysts have recommended investors to subscribe with a long-term outlook and a high-risk appetite. With an upper price band of ₹321, Ather’s EV/Sales ratio of 7.1x (FY24) appears expensive. The brokerage wrote, “Despite current profitability challenges and valuation concerns, we recommend a 'Subscribe' rating for high-risk investors with a long-term outlook.”

About the company

Founded in 2013, Ather Energy is engaged in designing, development and sale of Electric two-wheelers (E2Ws).