IPO Fully Subscribed for Ather Energy after Three Days; Find Out About GMP, Allotment Dates, and Cautions for Investors
Let's dive into the Day 3 subscription status of the Ather Energy IPO! The EV company's public offering has been in the market since April 28, with the final bidding scheduled for April 30. Investors can place their bids in a range of Rs 304-321 per equity share.
Current Subscription Status
As of the latest updates, the overall subscription for Ather Energy's IPO remains tepid, much like it was on Day 2, with only 0.30 times the issue being subscribed.
Retail Participation
Retail investors have shown strong interest, subscribing the IPO 1.20 times, making up for the lack of enthusiasm from institutional investors.
Institutional Appetite
However, institutional appetite is yet to pick up, with the QIB portion still untouched, and the NII category subscribing just 0.28 times.
Overview
Ather Energy aims to raise around Rs 2,981 crore through the public offer, which includes a fresh issue of 8.18 crore shares and an offer for sale of 1.1 crore shares.
Cautious Brokerage Views
Brokerages have expressed a cautious stance on the Ather Energy IPO, with many recommending an "Avoid" rating due to concerns about overvaluation, supply chain risks, and competition in the electric two-wheeler market.
Overvaluation
According to Deven Choksey Research, the Ather Energy IPO is currently offered at a EV/Sales valuation of 6x, which they believe is overvalued, and they suggest waiting for it to be available at more attractive valuations in the secondary market.
Supply Chain Worries
Ather Energy relies on imports from countries like China for its EV components, raising concerns about potential regulatory or policy changes and disruptions in the supply and pricing of lithium-ion cells.
Competition Worries
Many brokerages also pointed out the growing competition in the electric two-wheeler space, expressing a need for further rationalization in the valuation of Ather Energy's IPO compared to its competitors.
For investor details, the book-building issue will offer 8.18 crore fresh shares and 1.11 crore promoters' shares. The allotment for the IPO is expected to be finalized on May 2, with the listing likely to occur on May 6, if all goes as planned. Axis Capital, HSBC Securities & Capital Markets, JM Financial, and Nomura Financial Advisory And Securities (India) are the lead bookrunners of the issue, with Link Intime India serving as the registrar.
As we move towards the closing days of the Ather Energy IPO, it remains to be seen if institutional investors will make a move and whether the IPO will reach its maximum potential. Keep an eye on IPO Live Updates to stay informed about the latest developments!
Enrichment Data
Overall:
The Ather Energy IPO aims to raise Rs 2,981 crore (~$357 million) with a post-money valuation of $1.4 billion. The price band is Rs 304-321 per share. The IPO is being managed by JM Financial, Axis Capital, HSBC, and Nomura.
Subscription Progress:
- Day 1: 16% subscribed
- Day 2: 28–30% subscribed
- Final Day: 1.11x overall subscription achieved by 1:55 PM on closing day
- Retail: 1.49x
- QIBs: 1.35x
- NIIs: 35%
- Employees: 4.37x
Key Concerns:
- Sluggish Demand
- Financial Risks
- Competitive Pressure
Fund Utilization:
Proceeds will fund a new Maharashtra plant, R&D, marketing, and debt repayment. The listing is set for May 6.
- Although the overall subscription for Ather Energy's IPO remains tepid on Day 3, retail investors have shown a strong interest, subscribing the IPO 1.20 times.
- The finance raised through the Ather Energy IPO, aiming to generate approximately Rs 2,981 crore, may be used to fund a new Maharashtra plant, research and development, marketing, and debt repayment.
- The ongoing Ather Energy IPO, with a price band of Rs 304-321 per share, faces concerns about potential overvaluation, supply chain risks related to lithium-ion cell imports, and competition in the electric two-wheeler market.
- Despite the positive response from retail investors, institutional appetite for the Ather Energy IPO remains untouched, with the QIB portion still unsubscribed and the NII category subscribing just 0.28 times.
