Electric vehicle startup Ather Energy is in talks to raise funding from Nikhil Kamath, co-founder of stock brokerage firm Zerodha, as it looks to ramp up production capacity and expand sales.
New Investor Onboard
According to sources, Kamath is likely to invest in Ather through a secondary share sale, where existing investors sell a part of their holdings. The exact investment amount is still under wraps.
This will be Kamath’s latest bet on an Indian startup despite the ongoing funding winter. Earlier this year, he invested in gaming firm Nazara Technologies.
Recent Fundraise
Earlier in September, Ather secured Rs 900 crore in a rights issue from its key backers – Hero MotoCorp and Singapore’s sovereign wealth fund GIC.
However, Ather has had to scale back its fundraising plans due to the tough macro environment. The company was looking to raise around $200 million but closed the rights issue at a lower amount.
Ramping Up Capacity
The fresh capital will help Ather boost production to meet strong demand for its electric scooters. It aims to expand its annual capacity to over 1 million units from around 120,000 units currently.
Ather is also planning to expand its sales network by opening 100 new dealerships this fiscal year. This will allow the startup to geographically expand beyond its strongholds like Bengaluru.
Intensifying Competition
The additional funds come at a crucial time for Ather as competition in the electric two-wheeler space heats up. Ola Electric has taken the lead in the market after launching its electric scooters last year.
Incumbent two-wheeler giants like Bajaj Auto and TVS Motor have also forayed into the electric space. This diverse competition requires Ather to rapidly scale up to defend and grow its market share.
The funding from Kamath provides added firepower for this growth push. Ather last raised funding in October 2021 at a valuation of $739 million.
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