New Delhi: As competition in the electric two-wheeler market in India is heating up, Hero MotoCorp has upped its bet on Ather Energy, the maker of the electric scooter. The company will spend up to ₹1,758 crores ($184 million) to buy more stake in Ather Energy.
The new investment will result in an elevated stake of Ather for Hero MotoCorp, from 29.88% to approximately 32.8%. Ather is already the biggest shareholder of Hero. The additional shares will be acquired from a current shareholder, but Hero MotoCorp doesn’t give any details about the seller.
The move comes shortly after Ather allotted convertible warrants worth ₹960 crore to Hero MotoCorp as part of a separate preferential issue. This implies that Hero is beefing up their financial stake in Ather in several deals.
The enhanced investment represents a new thrust of Hero MotoCorp’s on India’s electric vehicle market. Motorcycle manufacturers and emerging electric vehicle companies are fighting it out to attract the riders of electric scooters in India, as the segment has emerged as an important part of the country’s two-wheeler industry.
Based in Bengaluru, Ather Energy has been trying to expand in the electric scooter market. The company recently announced a significantly lower loss for its Q1 results and attributed the dent in losses to favorable sales of its Rizta electric scooter, which is targeting the family segment.
The recent investment will add to Ather’s financial strength as it seeks avenues of growth and challenges the other players in the Indian electric scooter market.
There has been a vigorous competition in the Indian electric two-wheeler industry over the last few years. Companies are investing in new models, battery technology and charging networks, as well as in broader distribution, to attract more customers.
In Ather, Hero MotoCorp is putting another bet on fast-growing electric mobility, which would help build its market presence. With the growing demand for electric vehicles, the company has been developing its portfolio of products and services beyond its heritage of petrol-powered motorcycles and scooters.
The deal will allow Hero MotoCorp to own almost a third stake in Ather Energy, highlighting the importance of its partnership with the e-scooter company.
