Hero MotoCorp to acquire an additional 2.2% stake in Ather Energy for ₹124 cr in a transaction to be completed by 31 July 2024

The 2.2% stake will cost Hero MotoCorp an amount of ₹124 crore and the transaction is likely to be completed by July 31, 2024, the filing statement said. The current stake of Hero MotoCorp in Ather Energy is 39.7%.

Ather Energy is a Bengaluru-based company involved in designing, producing, manufacturing, selling, servicing, software development and management vis-a-vis automobiles and charging infrastructure.

So far, Ather Energy has raised ₹45.05 crore in 10 rounds of fund-raise. Hero MotoCorp participated in their latest funding on September 4, 2023. Other investors in this round were Caladium Investments, NIIF, Tiger Global Management, GIC, and InnoVen Capital.

“Ather Energy aims to turn profitable in the next 18-20 months as it looks for an IPO about that time—or earlier,” Ather Energy mentioned in a statement made in December 2023.

On the other hand, India’s largest two-wheeler maker, Hero MotoCorp, with a market cap of ₹1.12 trillion, is a constituent of the S&P BSE 100 index on the BSE. According to BSE data, the company’s stock returned 47.11% in the past six months and 90.60% YoY. In the last five years, Hero MotoCorp shares have surged 99.9% and 106.29% in a decade.

The two-wheeler major posted a 16.3% increase in consolidated profit after tax (PAT) to ₹943.46 crore in its Q4 FY2024 results riding on higher sales numbers. In the corresponding quarter in 2023, Hero MotoCorp reported a PAT ₹810.8 crore. The company’s revenue from operations in Q4 FY24 is ₹9,616.68 crore against ₹8,434.28 crore in the comparable period the previous year.

Dividend

Hero MotoCorp’s board of directors has proposed an interim dividend for FY 2024-25. It will be ₹40 per equity share with a face of ₹2 each. However, the dividend payout is subject to the board members’ approval at the next AGM.