Hero MotoCorp could be looking to increase stake in Bengaluru-based start-up Ather Energy assuming majority control of the company, according to a recent report that quotes industry sources. Hero could expand its stake in the company from the current 35 per cent with a major investment that will see the world's largest two-wheeler maker enter the electric vehicle space, leveraging Ather's strong engineering and product portfolio. However, Tarun Mehta, Co-founder and CEO, Ather Energy took to Twitter to refute the claim made in the aforementioned report. A simple 'Nope' summarised his response to the story.
The CNBC-TV18 report quotes a Hero MotoCorp spokesperson as, "With a stake of 34.6 per cent, Hero MotoCorp is already the largest shareholder in Ather. This reflects our confidence in the progress that Ather has made over the past few years. As already stated, our internal program on Electric Vehicles (EVs) is also progressing well. At a time when the world is increasingly moving towards partnerships, we remain open for further collaborations with suitable players in the emerging mobility space."
The report further states that Hero could start selling Ather electric scooters via its own dealerships across the country, once the two-wheeler maker takes control. However, the move would be a stark contrast from Ather's current business model that sees the company set-up experience centres as it expands to new cities, while the buying process largely takes place online. The report further suggests that Hero and Ather are in touch with the former likely to participate in future fundraising rounds as well.
Hero MotoCorp has been one of the early investors in Ather Energy and has invested ₹ 205 crore since 2016 in phases, followed by a fresh investment of ₹ 84 crore in July this year. The EV start-up has never spoken about giving control to the two-wheeler giant. Apart from Hero, Ather has also received investments from Sachin Bansal and Binny Bansal of Flipkart, InnoVen Capital, Aerospike founder Srini V Srinivasan, and Tiger Global Management. It also received its first funding from IIT Madras as campus incubated start-up.
Ather Energy is currently in the process of raising more funding as it expands production and network. The ₹ 84 crore investment was part of the ₹ 130 crore fund the company plans to raise in the next five years in a bid to set-up its new manufacturing facility, new experience centres in new cities and new products. The company has already confirmed that it plans to set-up presence in eight new cities by the end of the 2021 financial year. It will commence deliveries of the all-new Ather 450X in the coming weeks.
Meanwhile, Hero MotoCorp has also been working its own electric scooters. carandbike's exclusive story also brought you the first glimpse at the Hero e-Maestro that is under development. However, the Pawan Munjal led company could not sell Hero badged electric scooters in India due to a family agreement with Hero Electric led by Naveen Munjal. That being said, Hero MotoCorp could leverage from the learnings at Ather and capitalise on the EV boom.