Ather Energy has indicated that it expects to achieve a 90% attachment rate in North India soon, signalling growing consumer adoption of its electric two-wheelers in the region. The company is simultaneously contending with short-term margin pressure and has undertaken price hikes as part of its near-term strategy.

Key Developments at a Glance

The following table summarises the key highlights from Ather Energy's recent disclosures:

North India Expansion and Attachment Rate Target

Ather Energy's expectation of a 90% attachment rate in North India reflects the company's focus on deepening its penetration in one of India's key automotive markets. The attachment rate is a measure of how effectively the company converts its dealer or customer touchpoints into actual sales, making this target a significant operational milestone for the brand in the region.

Margin Pressure and Pricing Strategy

Alongside its expansion ambitions, Ather Energy has acknowledged facing short-term margin pressure. In response, the company has undertaken price hikes, a move that reflects efforts to offset cost headwinds and protect profitability. The interplay between pricing actions and margin dynamics will be a key area of focus for the company in the near term.

Ather Energy Limited filed its Monitoring Agency Report for the quarter ended March 31, 2026, with the stock exchanges on May 04, 2026, pursuant to Regulation 32 of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, read with Regulation 41 of the SEBI (Issue of Capital and Disclosure Requirements) Regulations, 2018. The report was prepared by CARE Ratings Limited, which serves as the designated Monitoring Agency for the company's IPO proceeds aggregating to Rs. 2626.00 crore. The IPO was a public issue of equity shares conducted from April 28, 2025 to April 30, 2025. The company's promoters are Tarun Sanjay Mehta, Swapnil Babanlal Jain, and Hero Motocorp Limited, and it operates in the Automobiles and Auto Components — Automobiles sector.

IPO Proceeds Utilisation as at March 31, 2026

As at the end of the quarter ended March 31, 2026, cumulative utilisation of IPO proceeds reached Rs. 1008.93 crore, with Rs. 194.98 crore deployed during the quarter alone. A total of Rs. 1617.07 crore remains unutilised. The monitoring agency confirmed that all IPO proceeds were used for objects as stated in the prospectus, all payments were routed through the monitoring agency account, and no deviations from the offer document were observed. There was also no change in the means of finance for the disclosed objects, and no major deviation was noted compared to the previous monitoring agency report dated November 10, 2025.

The table below summarises the progress in utilisation across all objects as at March 31, 2026:

Cost Revisions and Object-wise Commentary

Two line items saw minor revisions in their allocated amounts following a Board of Directors resolution dated February 02, 2026. Issue expenses were revised downward from Rs. 116.60 crore to Rs. 110.00 crore on account of actual issue expenses being lower than originally estimated. The resultant difference was reallocated to general corporate purposes, raising that allocation from Rs. 492.20 crore to Rs. 498.80 crore. All other objects — E2W factory capital expenditure (Rs. 927.20 crore), repayment of borrowings (Rs. 40.00 crore), research and development (Rs. 750.00 crore), and marketing initiatives (Rs. 300.00 crore) — remained unchanged. Total gross proceeds remain at Rs. 2626.00 crore.

Key expenditure details for the quarter are as follows:

• E2W Factory (Maharashtra): Rs. 60.83 crore deployed during the quarter towards civil work, raw materials, paint robots, battery pack assembly lines, overhead conveyor systems, assembly line systems, paint circulation systems, and management consultancy for construction tracking and quality checks.
• Research & Development: Rs. 69.05 crore utilised during the quarter, comprising Rs. 22.01 crore on manpower costs in the R&D department and Rs. 47.04 crore on non-manpower costs including testing and measuring equipment, vehicle lamp testing, and designing services.
• Marketing Initiatives: Rs. 22.52 crore paid to the marketing agency under a service agreement as mentioned in the prospectus.
• General Corporate Purposes: Rs. 42.58 crore utilised during the quarter, comprising Rs. 42.57 crore towards purchase of raw materials and Rs. 0.01 crore towards employee-related expenses and other operating expenses.
• Repayment of Borrowings: Fully utilised; completed as on September 30, 2025.
• Issue Expenses: No utilisation during the quarter.

Factory 3.0 — Implementation Delay and Status

The monitoring agency noted a delay in the capital expenditure object related to the establishment of the E2W factory (Factory 3.0) in Maharashtra. As per the offer document, Rs. 705.50 crore was to be deployed in FY26; actual utilisation stood at Rs. 139.63 crore. The delay is attributed to the receipt of an Environmental Clearance in September 2025, which was not originally required at the time of the prospectus filing dated April 30, 2025. This shifted the construction start from May 2025 to September 2025. Consequently, the expected commencement of production at Factory 3.0 has been revised to October 2026 from the originally envisaged July 2026. As per management, the overall project completion timeline of March 2027 remains intact. As at March 31, 2026, the company has spent 21% (including land cost) of the total project cost and has raised purchase orders worth 67% of the total project cost. Pre-construction government approvals obtained include Consent to Establish, Town and Country Planning Approvals, GST Registration, ESI Registration, and Environmental Clearance (received during Q2FY26).

A delay was also noted in marketing initiatives expenditure, with Rs. 90.44 crore paid against the FY26 target of Rs. 150.00 crore. The company noted that total marketing incurred in FY26 amounted to Rs. 128.03 crore (comprising Rs. 90.44 crore paid and Rs. 37.59 crore payable), representing over 85% of the Rs. 150.00 crore outlined in the offer document. The balance is expected to be utilised in FY27. Similarly, general corporate purposes deployment of Rs. 140.30 crore has been deferred from FY26 to FY27 on account of optimised cash management.

Deployment of Unutilised Proceeds

The unutilised IPO proceeds of Rs. 1617.07 crore as at March 31, 2026 have been deployed across fixed deposits with Axis Bank, Kotak Bank, and IDFC Bank, along with residual balances in the HSBC Bank Monitoring Account and Axis Bank Public Offer Account. The table below presents a summary of the key fixed deposit instruments:

Total earnings on the deployed proceeds, including interest received and interest accrued, amounted to Rs. 91.20 crore, with a total market value of Rs. 1626.13 crore as at the end of the quarter. The monitoring agency confirmed no conflict of interest in its relationship with the issuer while monitoring and reporting the utilisation of IPO proceeds.