No ICE blues for Ather as it inches closer to profitability
New Delhi: Ather Energy Ltd reported record revenue in the December quarter and moved a step closer to profitability despite electric two-wheeler penetration falling in the holiday quarter following tax cuts on fossil fuel-powered vehicles.
Rizta electric scooter maker sees losses more than halved ₹Earnings before interest, tax, depreciation and amortization (EBITDA) or operating margin rose 16 percentage points to Rs 85 crore in the third quarter of fiscal 2026 from -19% to -3% in the previous year. Total revenue increased by 53% year-on-year ₹996 crore in the quarter as e-scooter sales rose 50% to 68,000 units.
“This is certainly a pretty strong performance by our partners across the country. Distribution has continued to expand in the direction we’ve guided,” Ather co-founder and CEO Tarun Mehta told analysts and investors during Monday’s post-earnings call.
“We ended Q3 with 600 open pan stores in India and are on track to open 700 stores by the end of this financial year,” he said, citing increased distribution as the driver of growth.
Ather’s sales and revenue increased despite cuts in the goods and services tax in September reducing the prices of internal combustion engine (ICE) vehicles and reducing the share of electric vehicles in the October-December period. According to data from the Federation of Automobile Dealers Associations (Fada), electric vehicle penetration fell from 8% in September to 4.6% in November, then rose to 7.4% in December.
While GST on most ICE two-wheelers was reduced from 28% to 18% in September, EVs remained at a concessional rate of 5%, narrowing the price gap between them.
Ather is the first pure The electric vehicle company will publish its quarterly results, ahead of major rivals Bajaj Auto Ltd and TVS Motor Co. will announce its results last week.
The sharp improvement in Ather’s profitability margins came in the quarter when Bajaj Auto’s battery-powered two-wheeler business remained operationally stable. Once the market leader Ola Electric achieved EBITDA (earnings before interest, taxes, depreciation and amortization) breakeven point in its two-wheeler electric vehicle business in the July-September quarter.
Ather said its margins have increased thanks to achieving scale in sales and better cost management. However, the market will face headwinds as input costs rise and the government’s subsidy for electric two-wheelers under the PM E Drive scheme will end by March.
market share
Higher sales have seen Ather become India’s third-largest electric two-wheeler maker, surpassing intercity rival Ola Electric Ltd and its largest shareholder Hero MotoCorp Ltd. TVS Motor leads the market and follows it Bajaj Auto.
According to data from the government’s Vahan portal, Ather Energy sold 21,924 scooters in January; This is almost three times the 7,512 units recorded by Ola. Ola’s sales in January were the lowest since it went public in August 2024.
Ather’s Mehta said the electric two-wheeler industry continues to grow despite economic developments. GST cuts suggest industry watchers need to watch downstream developments ₹1 lakh and above ₹1 lakh scooters separately.
“The real growth in the two-wheeler electric vehicle industry is being masked by the substandard nature of a large number of vehicles. ₹The price point has fallen by 1 lakh in the last one year. Products priced above ₹1 lakh has grown at a nice growth rate in the last 18 months, Mehta said during the earnings call.
“When you put the entire industry together, you see very modest growth… There’s a lot of fluff at the bottom. ₹1 lakh was lost. “There are buyers in the segment and there are a lot of good products available now, so growth should come back,” Mehta said, adding that signs of recovery were already visible.
Shares of Ather fell 2.5% on Monday against a 2.1% rise in Nifty Auto. But investors have shown confidence in the stock, which has doubled in the last eight months since the company was listed.
