Ather Energy , a prominent player in the electric vehicle (EV) sector, has announced a significant decision to defer demand incentive claims worth Rs 262.50 million under the PM E-DRIVE scheme. This move affects up to 52,500 vehicles and comes in response to global supply chain disruptions caused by China's export ban on certain heavy rare earth magnets.

Supply Chain Challenges

The export ban has forced Ather's motor suppliers to make temporary adjustments in their manufacturing processes, particularly concerning the domestic fitment of magnets. These changes have led to deviations from the Phased Manufacturing Program (PMP) guidelines for traction motor manufacturing, a key component of the PM E-DRIVE scheme compliance.

Seeking Temporary Exemption

Ather Energy is currently in discussions with the Ministry of Heavy Industries (MHI), seeking a temporary exemption from domestic fitment requirements for magnets. The company emphasizes that this situation was beyond their control and that they remain committed to complying with all PM E-DRIVE and PMP guidelines.

Innovative Solution

In response to these challenges, Ather has developed an alternative solution - a Heavy Rare Earth Free (HREF) motor. The company has already received type approval from the Automotive Research Association of India (ARAI) for this innovation. Furthermore, Ather has begun receiving PM E-DRIVE eligibility certificates for these HREF motors across different models, demonstrating their commitment to adapting to the changing landscape.

Impact on Financial Claims

The deferral of demand incentive claims is a precautionary measure taken by Ather Energy. The company has decided to hold off on submitting claims for the affected vehicles until they receive definitive approval regarding the deviation from the PMP requirements.

Commitment to Make in India

Despite these challenges, Ather Energy reaffirms its dedication to the Make in India initiative and maintains its commitment to full compliance with PMP guidelines. The company views this as a temporary setback and is actively working towards resolving the issue.

This development highlights the intricate challenges faced by the EV industry in India, particularly in relation to supply chain dependencies and regulatory compliance. It also underscores the importance of innovation and adaptability in overcoming unforeseen obstacles in the rapidly evolving electric mobility sector.

In a tale of contrasting fortunes, Ather Energy and Ola Electric, two prominent players in India's electric two-wheeler market, have experienced divergent paths since their initial public offerings (IPOs). While Ather Energy has seen a significant surge in its share price, Ola Electric has faced a decline, highlighting the dynamic nature of the electric vehicle (EV) sector in India.

Stock Performance

Ather Energy's shares have demonstrated remarkable growth, soaring 66.40% from their listing price of ₹326.05 to reach ₹542.55. This impressive rally underscores investor confidence in the company's prospects and its positioning in the competitive EV market.

In contrast, Ola Electric has experienced a downturn, with its share price declining by 22.50% from the IPO price of ₹76.00 to ₹58.90. Despite this setback, Ola Electric maintains a larger market capitalization at ₹25,181.00 crore, compared to Ather Energy's ₹20,272.00 crore.

Financial Performance

The financial results of both companies reveal interesting insights into their operational efficiency and growth trajectories:

Ather Energy has shown promising signs of improvement, narrowing its net loss to ₹178.00 crore while achieving a substantial 79% growth in revenue to ₹645.00 crore. The company has also enhanced its EBITDA margin to -16.00%, indicating progress towards profitability.

On the other hand, Ola Electric faced challenges, posting a wider net loss of ₹428.00 crore. The company's revenue halved to ₹828.00 crore, and its EBITDA margin deteriorated to -28.60%, reflecting operational hurdles.

Market Outlook

Analysts have taken note of these contrasting performances. Ather Energy's strong uptrend has led to technical targets being set at ₹560.00-575.00, suggesting potential for further gains. Conversely, Ola Electric faces a less optimistic outlook, with analysts pointing to a potential decline to ₹55.00.

Strategic Developments

In terms of policy advantages, Ola Electric has secured Production Linked Incentive (PLI) certification for its Gen-3 scooters, potentially providing the company with strategic benefits. Meanwhile, Ather Energy's CEO has called for a review of the auto-PLI framework, indicating the company's proactive stance in shaping industry policies.

Market Positioning

Both Ather Energy and Ola Electric continue to compete in India's burgeoning electric two-wheeler market, each adopting different positioning strategies to capture market share. As the EV sector in India evolves, the contrasting fortunes of these two companies highlight the opportunities and challenges that lie ahead in this rapidly growing industry.

Investors and industry observers will be keenly watching how these companies navigate the competitive landscape and regulatory environment in the coming months, as their performance could have significant implications for the broader EV market in India.