Hero MotoCorp raises Ather Energy stake to 32.8% with ₹1,758 crore share purchase

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TL;DR:

Hero MotoCorp will spend up to ₹1,758 crore to raise its Ather Energy stake to about 32.8%. Crucially, this is a secondary share purchase, while a separate ₹960 crore warrant allotment provides the fresh-capital route into Ather.

Article:

Hero MotoCorp has approved a cash purchase of up to ₹1,758 crore in Ather Energy, lifting its fully diluted stake from 29.88% to about 32.8%. The shares will be bought from an existing Ather shareholder, with completion targeted by September 3. No governmental or regulatory approval is required, according to the disclosure.

The financial nuance is important: the ₹1,758 crore is a secondary share purchase, so the money goes to the selling shareholder rather than Ather. Fresh capital is coming through a separate preferential allotment under which Ather issued Hero 76.19 lakh convertible warrants worth about ₹960 crore. Only 25% of the warrant price was payable upfront, with the balance due on conversion.

Hero is increasing its exposure as Ather’s operating performance improves. In Q1 FY27, Ather delivered 83,173 scooters, up 80.5% year on year, while consolidated total income rose 87.2% to ₹1,260 crore. EBITDA turned positive at ₹9 crore from a ₹106 crore loss a year earlier, although net loss remained ₹51 crore. Ather CEO Tarun Mehta said demand was “far outstripping supply.”

The relationship is not new. Hero has invested in Ather since 2016 and held 34.58% after a 2020 investment, meaning the new 32.8% stake does not by itself represent an unprecedented ownership level.

Ather shares rose about 4.5% on Friday after the announcement. The next test is whether stronger demand, new products and planned capacity expansion can translate into sustained profitability as electric two-wheeler competition intensifies.