Ather Energy raises $128 mn in series E round

Chennai: Electric vehicle (EV) maker Ather Energy on Thursday said it has closed a Series E round of funding, raising $128 million from the national sovereign fund National Investment and Infrastructure Fund Limited’s (NIIFL’s) Strategic Opportunities Fund, existing and significant shareholder Hero MotoCorp, and other investors.

This is Ather’s first large institutional financing after a 7-year gap after the EV startup's fundraise from Tiger Global back in 2015. So far, Ather has raised over $230 million in total funding. The company did not disclose its valuation but said it had improved significantly from the previous round. This is also NIIFL’s first direct investment in the manufacturing sector and in electric mobility.

“This is a double validation of sorts for us. Not just as the first EV company backed by the sovereign fund but also as it is our first significant institutional capital raise after a long gap,” Tarun Mehta, co-founder and CEO, Ather Energy, said. “We have been busy executing all these years, have run a very tight ship since commercial launch in 2018, and it was now time to fix our liquidity to meet our priorities for the coming year,” he added.

Ather Energy plans to use the funding to beef up its supply chain capabilities to scale from 5,000-6,000 units per month to over 30,000 units, expand its manufacturing facilities, and invest in research and development, among others.

Ather’s funding round comes at a time of crisis for the electric two-wheelers industry as instances of scooters catching fire and other safety issues involving Ola Electric, Okinawa, PureEV and others have garnered attention. Mehta says sales have been good despite the industry woes with the company registering the highest ever monthly sales in April delivering 3,779 units. Booking orders for Ather's flagship -the Ather 450X- is growing at 25% quarter-on-quarter, the startup said.

“We want to be a ‘no-brainer decision’ for customers. Safety has to be a given when it comes to any vehicle, and continuing our focus on quality, we are keen to emerge as the consistent and reliable brand in our sector,” Mehta said.

“Aligned to India’s green transition mission, the electric two-wheeler industry is expected to grow significantly in the coming years. Ather Energy has indigenously designed and developed products with a high degree of domestic sourcing of components and adaptability to Indian conditions. We are excited to partner with Ather Energy’s founders and management team who have developed deep expertise in the industry, a robust IP portfolio, and built strong manufacturing and distribution capabilities. We are also impressed with Ather Energy’s partnerships for component manufacturing, charging infrastructure and customer financing,”Padmanabh Sinha, executive director & chiefiInvestment officer - NIIFL, said in a statement.

Ather Energy has also installed a public charging network — Ather Grid — designed and built-in India. With over 310 charging points across India, Ather Energy currently operates in 32 cities, and is backed by Flipkart founders Sachin Bansal & Binny Bansal, Hero Motocorp and Tiger Global.