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Sachin Bansal Exits Ather Energy by Selling Remaining Stake to Hero MotoCorp and Nikhil Kamath

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Flipkart cofounder Sachin Bansal has exited Ather Energy, the electric scooter manufacturer, by selling his remaining 7.5% stake. This marks a significant shift in Ather Energy’s investor landscape.

Bansal sold a 2.2% stake to two-wheeler giant Hero MotoCorp for Rs 124 crore, while the remaining shares were acquired by Zerodha cofounder Nikhil Kamath. This move follows earlier reports from April 23 by the Economic Times (ET) indicating Bansal’s intentions to divest his shares in Ather.

As one of the pioneering investors in Ather, Bansal had injected approximately Rs 400 crore into the company since 2014. Previously, Bansal had offloaded part of his stake to Kamath, a development also reported by ET on April 23. Flipkart cofounder Binny Bansal continues to hold a 1% stake in the company.

Hero MotoCorp, in its latest regulatory filing with the Bombay Stock Exchange (BSE), confirmed the additional share acquisition, which did not name the seller. This purchase raises Hero MotoCorp’s total shareholding in Ather Energy to about 40%, reinforcing its position as the largest shareholder.

The latest transaction was executed at an inferred valuation of Rs 5,636 crore, a notable increase from the Rs 4,666 crore valuation at which Hero MotoCorp had previously invested Rs 140 crore in Ather last December. This valuation indicates that the remaining 5.3% stake sold to Kamath is worth approximately Rs 282 crore.

Despite the significant stake changes, representatives from Hero MotoCorp, Ather Energy, and Sachin Bansal have remained tight-lipped, declining to comment on the developments. A spokesperson for Nikhil Kamath also declined to comment.

Hero MotoCorp’s recent investment highlights the company’s confidence in Ather’s potential, despite the electric scooter maker reporting a turnover of Rs 1,753 crore for fiscal 2024, slightly down from Rs 1,784 crore in FY23. Notably, Ather posted a net loss of Rs 864 crore in FY23, reflecting the challenges in the competitive electric scooter market.

The investment announcement coincides with Ather raising Rs 286 crore ($34 million) from its founders and Stride Ventures through a combination of debt and equity funding. Ather is also planning to raise an additional $75-90 million (approximately Rs 750 crore) from new and existing investors, potentially valuing the firm between $850 million and $1 billion. This follows a Rs 900 crore rights issue in September 2023 involving Hero MotoCorp and GIC.

Competing against Ola Electric, TVS, and Bajaj, Ather Energy is expanding its market presence. On April 6, the company launched a new range of ‘Rizta’ scooters, aiming to capture the family segment. With an annual production capacity of 450,000 scooters, Ather plans to scale up from its current output of 150,000 vehicles per year following the Rizta launch.