Monday, July 15, 2024

Hero MotoCorp Increases Stake in Ather Energy for Rs 124 Crore

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Indian two-wheeler giant Hero MotoCorp is set to increase its stake in Bengaluru-based electric two-wheeler manufacturer Ather Energy. According to a regulatory filing, Hero MotoCorp will purchase an additional 2.2% stake in Ather Energy for approximately Rs 124 crore. This transaction, involving the purchase of additional shares from an existing shareholder, is expected to be completed by July 31, 2024.

Hero MotoCorp’s Previous Acquisition

This latest move follows Hero MotoCorp’s earlier acquisition, where it bought an additional 3% stake in Ather Energy for Rs 140 crore. This previous investment increased Hero MotoCorp’s total shareholding to 39.7%. With the upcoming transaction, Hero MotoCorp’s total stake in Ather Energy will rise to about 41.9%. Notably, Hero MotoCorp is a significant investor in Ather Energy, alongside other major stakeholders like Tiger Global and Singapore’s GIC.

Ather Energy’s Recent Funding

Ather Energy recently raised Rs 286 crore through a mix of debt and equity funding. Stride Ventures invested Rs 200 crore via non-convertible debentures, while Ather’s co-founders, Tarun Sanjay Mehta and Swapnil Babanlal Jain, each contributed Rs 43.28 crore through Series F compulsory convertible preference shares. Despite facing competition from Bhavish Aggarwal-led Ola Electric, Ather Energy remains a strong player in the Indian electric vehicle market. For the fiscal year ending March 31, 2024, Ather Energy reported a turnover of Rs 1,753.8 crore, slightly down from Rs 1,784 crore the previous year.

Hero MotoCorp stake in Ather Energy, Hero Motocorp brand logo

Ather Energy’s Market Presence

Founded in 2013 and based in Bengaluru, Ather Energy is a leading player in India’s electric two-wheeler market. The company designs, manufactures, and sells popular electric scooters like the Ather 450X, Ather 450 Plus, and Ather 450S. Ather also boasts an extensive network of over 1,400 charging stations across 100 cities, making it a significant player in the EV infrastructure space.

Hero MotoCorp’s Market Performance

Hero MotoCorp is a dominant name in the Indian two-wheeler market, known for its wide range of motorized two-wheelers and related services. In the fourth quarter of FY24, Hero MotoCorp reported an 18.29% increase in standalone net profit to Rs 1,016.05 crore. Revenue also rose by 14.6% to Rs 9,519.30 crore compared to the same period last year.

Hero MotoCorp’s increased investment in Ather Energy highlights its strategic focus on the growing electric vehicle market in India. With this additional stake, Hero MotoCorp is well-positioned to leverage Ather Energy’s innovative products and extensive charging network, reinforcing its leadership in the Indian two-wheeler industry.

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