Ather Energy Shares Jump 8% After HSBC, Nomura Raise Price Targets

Shares of Ather Energy jumped as much as 8.1% to an intraday high of ₹1,702 on the BSE after HSBC and Nomura raised their price targets following the electric two-wheeler maker’s Q2 FY27 results.

At 11:28 IST, the stock was trading 6.8% higher at ₹1,680.60, giving the company a market capitalisation of ₹66,672.4 Cr (about $6.9 Bn).

The gains extended yesterday’s rally, when Ather shares closed 13.7% higher at ₹1,574 on the BSE after the company announced its Q2 FY27 results during market hours.

Adding to the positive sentiment, HSBC and Nomura retained their ‘Buy’ ratings and raised their price targets, citing better-than-expected margins and stronger growth prospects following the launch of Ather’s Konarc scooter range.

HSBC raised its price target to ₹1,800 from ₹1,600. The brokerage said Ather delivered a strong second quarter, with EBITDA breaking even ahead of expectations despite commodity cost pressures.

Nomura increased its price target to ₹2,070 from ₹1,926. It said Ather’s EBITDA margin, excluding other income, stood at 0.8%, beating its estimate of negative 2.6% and the consensus estimate of negative 2.7%. Stronger bookings and improved growth visibility following the Konarc launch were other positives.

Ather’s Maiden Profitable Quarter

Ather reported a consolidated net profit of ₹1.3 Cr in Q2 FY27 as against a loss of ₹154.1 Cr a year earlier, supported by stronger revenue growth, improving margins, and other income. It had posted a net loss of ₹51.1 Cr in the preceding quarter.

Operating revenue rose 62.9% YoY and 20.3% QoQ to ₹1,464.2 Cr. Including other income, EBITDA stood at ₹74.2 Cr, with a margin of 4.9% as against -9.6% a year earlier and 0.8% in Q1 FY27.

Total income rose to ₹1,527 Cr from ₹940.7 Cr a year earlier. However, operating revenue remained ₹61.5 Cr below total expenses of ₹1,525.7 Cr, underscoring other income’s contribution to net profitability.

CEO Tarun Mehta said during the earnings call that Ather would prioritise capacity expansion and sales growth over near-term net profitability. He cautioned that some margin gains came from temporary measures, including changes to its product mix and reduced incentives, which offered limited scope for further support if commodity prices remained elevated. 

Ather To Expand Manufacturing Capacity

Ather plans to invest ₹122 Cr to expand manufacturing capacity at its Hosur plant in Tamil Nadu and its upcoming Factory 3.0 in Maharashtra’s Chhatrapati Sambhajinagar. The expansion is expected to add 2.25 Lakh units of annual capacity.

At Hosur, the company plans to invest up to ₹58 Cr, including taxes, to add capacity for 75,000 units annually by December 2026. Ather has also earmarked ₹53 Cr for a new battery line, which is expected to be completed by Q3 FY28.

At Factory 3.0, the company plans to invest ₹64 Cr to add 1.5 Lakh units of annual capacity to the planned 5 Lakh units. The expansion is expected to be completed by Q2 FY28.

Ather will finance the investments through a combination of debt and internal accruals. During Q2 FY27, it also raised ₹1,300 Cr through a qualified institutions placement and ₹200 Cr through a preferential equity allotment.

The expansion follows a sharp increase in customer interest. Enquiries rose 109% YoY to around 10 Lakh in Q2 FY27, while pre-orders more than doubled to 1.8 Lakh. Vehicle sales increased 42% to 93,211 units.

Ather launched its sub-₹1 Lakh Konarc electric scooter range during the quarter, taking its portfolio to 15 variants across three product lines.

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