New Delhi: Ather Energy, backed by Hero MotoCorp, hopes to be profitable at the operating level next year, and it looks like a top official in the company is raising capital to fund its future business expansion program.
The company wants to use its ‘450 platform’ to spin more variants and also enter the electric two-wheeler segment for the mass market.
‘The last term was the most successful in Ather’s history. Our sales grew about 2.5 times quarter on quarter … Our overall cost structure, assembly time, material costs all decreased, and more importantly: we eventually achieved positive unit economy (positive gross margins).
‘The amount of work over the past one / one and a half years and with the sales now increasing, has finally brought us into the space where we have a positive gross margin for every vehicle sold.
“Obviously we’re not profitable, it’s not really EBIDTA profitable, but it’s putting you on a good path now with increasing sales,” said Ather Energy CEO Tarun Mehta and co-founder.
Asked when the company’s EBIDTA will be profitable, he said: “… we will bridge this gap and hopefully EBIDTA profitability is something that will be in the near future … next year we hope for.”
On the company’s plan to raise more funds, Mehta said: ‘While looking at gross positive margins, the company is currently continuing to spend cash and it will be a while before we become profitable. We will be raising more cash in the near future ”.
On the question of whether Ather Energy will put new investors in the bag, or whether it depends on current investors for future funding, he said it will depend on many factors, but ‘where Ather is, where the business is, I think quite probably the next round of investors ”May also include external persons.
As for Hero MotoCorp, he said: “They have supported us in rugby teams and I definitely expect them to remain extremely clumsy for us”.
Last November, Ather Energy raised $ 35 million in a round of financing led by Flipkart co-founder Sachin Bansal’s $ 23 million investment, while Hero MotoCorp invested $ 12 million as a Series D investment.
In February this year, the company announced an investment of 635 million over the next five years. It has set up a new production unit that can produce 1.1 lakh scooters and 1.2 lakh battery packs per year annually.
Regarding Mehta’s future product range, Mehta says, the company is currently in the premium electric two-wheeler segment with its 450X and 450 Plus models, but ‘we want to pick up more and more segments, use the 450 platforms to launch variants across the spectrum ”.
Asked if it would also lead to the mass segment, he said: “Ather today has the most competitive cost structure in the whole (EV) industry, and I believe it will be the cheapest architecture over the next one or two years and offers the highest performance.
“This is what integration will give us as an advantage. If and when this happens, we can react the product very comfortably over different price points. ”
Earlier this year, Ather Energy confirmed deliveries and presence in 27 cities in 15 states, including Bangalore, Chennai, Mumbai, Pune, Delhi, Hyderabad and Kolkata, and is likely to expand to 40 cities by the end of 2021.
Source: Telangana Today