Ather Energy vs Ola Electric IPO: Which EV Stock Offers Better Investment and Valuation Comfort?

India’s electric two-wheeler market is rapidly evolving, with Ather Energy [NSE: ATHERENERG] and Ola Electric [NSE: OLAELEC] emerging as prominent players. Both companies have recently entered the public markets, offering investors a chance to participate in the country’s EV transition. This article comprehensively compares their IPOs, financials, market positions, and valuation metrics.

Ather Energy vs Ola Electric: IPO Overview

Here is a detailed overview of both the electric vehicle IPOs:

 Ather Energy vs Ola Electric: IPO Subscription Status and Listing Gains

Since both Ather Energy and Ola Electric recently debuted in the market, let’s see how they performed on listing day.

Ather Energy IPO:

• Subscription Status: Ather Energy’s IPO was subscribed 1.43 times overall. Retail investors showed strong interest, subscribing 1.78 times, while Qualified Institutional Buyers (QIBs) subscribed 1.70 times. However, Non-Institutional Investors (NIIs) showed weaker demand, subscribing only 66% of their allotted portion.
• Listing Gains: Ather Energy shares debuted on May 6, 2025, at ₹323.55 per share, reflecting a 0.7% premium over the issue price of ₹321. The Grey Market Premium (GMP) had indicated a listing price of around ₹333, but the actual listing was slightly lower. 

Ola Electric IPO:

• Subscription Status: Ola Electric’s IPO saw significantly higher demand, with an oversubscription of 4.45 times. Retail investors subscribed 4.05 times, QIBs 5.53 times, and NIIs 2.51 times, indicating stronger investor confidence than Ather Energy.
• Listing Gains: Ola Electric listed at ₹75.99 per share on BSE and ₹76 on NSE, which was flat to slightly discounted compared to its issue price of ₹76.

Ather Energy vs Ola Electric: Which is Better?

Here is how both EV stocks in India fare on different parameters.

Revenue Growth

Ola Electric, between 2021 to 2024, posted a higher compound annual growth rate (CAGR) of approximately 125% compared to Ather Energy’s 92%. It has also significantly reduced its losses per unit, indicating better operational efficiency, whereas Ather Energy faces underutilised production capacity and high marketing costs.

In the third quarter of the financial year 2024-25, Ola Electric posted a revenue of ₹1,172 crores but simultaneously reported a net loss of ₹564 crores. Conversely, as of December 31, 2024, Ather Energy reported a revenue of ₹1,617.4 crore, with a corresponding net loss of ₹577.9 crore for the same period.

Operational Efficiency 

Ola Electric is working on building a complete EV solution, manufacturing key components such as vehicle frames and battery cells. In contrast, Ather Energy only manufactures EVs and has yet to enter battery cell production. Depending on sourcing battery cells from third parties means Ather loses control over 50% of its manufacturing costs. 

One major downside of Ather Energy is that third parties manage the company’s service networks. Given that EVs are built with complex parts, the lack of expertise and proper training for partners can impact trust among their potential customers.

Research and Development 

Ola Electric is investing more heavily in research and development (R&D) to boost its capacity and innovate its offerings. As of the financial year 2024, the company has invested 7.69% of its operational revenue into its R&D and intellectual property portfolio. In contrast, Ather contributes 6.6% of its revenue to R&D expenditure.

Regarding intellectual property, Ola has 88 patents to its name, with 217 in the review stage, whereas Ather has 45 patents and 210 pending applications. 

Market Share

As of the financial year 2024, Ola Electric has sold 3.29 lakh units, while Ather has managed to sell only 1.09 lakh units. The primary reasons for this difference are features and pricing.

Ather’s entry-level scooter, priced at ₹1.12 lakh, includes inter-city trip planners and smart helmet integration. In contrast, Ola Electric targets middle-class and low-income groups with its entry-level scooter priced at ₹80,000, offering features like navigation assistance and multiple riding modes.

Underutilised Capacity

Ather failed to utilise its production capacity, which stands at 4.2 lakh units, as the company’s capacity utilisation rate is just 29%. However, the company plans to boost its production to 1.42 million units in the coming months.

On the other hand, Ola Electric has a production capacity of 6.8 lakh units, and its utilisation rate of 49% is much better than Ather’s. Not only that, but the company is planning to expand its product portfolio by launching e-bikes to meet the expectations of its target customers.

Debt Levels

As of December 31, 2024, Ather Energy has total borrowings of ₹521.6 crore, while for the period ending on March 31, 2024, Ola Electric has a significantly higher debt burden of ₹2,389.21 crore. This indicates that Ola Electric is leveraging more debt to fund its operations and expansion compared to Ather Energy. However, since Ola Electric is aggressively expanding its portfolio, debt is not necessarily a negative sign from an investor’s perspective. It is worth tracking how it manages its debt in the long run.

Conclusion

While both Ather Energy and Ola Electric present promising prospects in India’s EV sector, Ola Electric currently holds the edge in market share, revenue growth, R&D investment, and operational efficiency. Although its debt is higher, Ola’s strategic expansion and stronger investor interest position it as the more compelling IPO bet for long-term growth.

However, when it comes to post-IPO performance, it is too early to predict anything. Therefore, regardless of which stock you add to your portfolio, it is important to evaluate your risk tolerance and keep an eye on the news related to both companies and how their new launches can affect their performance to decide between the two.

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