Indian electric scooter-maker Ather Energy cuts IPO size

The company will use the IPO proceeds for funding its new factory in the western state of Maharashtra, as well as for research and development.

India’s Ather Energy has reduced the size of its initial public offering, its prospectus showed on Tuesday, as the electric scooter maker seeks to list at a time when U.S. tariff concerns have roiled stock markets globally.

The Tiger Global-backed company plans to raise 26.26 billion rupees ($308.3 million) by issuing new shares, compared with its earlier plan of raising 31 billion rupees.

Existing shareholders will offload 11.1 million shares, around half the 22 million shares they planned to sell earlier.

Indian motorcycle maker Hero MotoCorp is the largest shareholder in Ather with around 40% stake. Hero maintained its stance that it will not sell its shares in the IPO.

While the company did not provide a reason for cutting the IPO size, it comes after turmoil in India’s stock markets, partly due to the volatility in global markets as well as weak consumption trends in the country.

Foreign investors have continued offloading their holdings, net selling Indian equities worth nearly $33 billion between the second half of last fiscal and mid-April.

Ather said it will open share bidding for three days starting April 28, while anchor investors are set to participate in a private placement of stock on April 25.

The company will use the IPO proceeds for funding its new factory in the western state of Maharashtra, as well as for research and development.

Ather was one of the first companies to sell e-scooters in India in 2018, but has fallen behind larger rivals Ola Electric and TVS Motor, whose discounts and larger distribution network have driven sales.

The Bengaluru-based company reported a narrower loss of 5.78 billion rupees in the nine months ended December, from 7.76 billion rupees a year ago, due to increased sales of its electric family scooter Rizta, which was launched last year.