Ather Energy Limited — Q4 FY26 earnings call

Call held 4 May 2026

Management summary

Ather Energy reported a breakthrough FY26, driven by a 66% increase in overall volumes and a significant market share gain to 18.6% in Q4, largely attributed to the new Rizta product. The company doubled its store count to 700 and achieved a 93% Pro-Pack attach rate in Q4. EBITDA losses dramatically improved to negative 2% in Q4 FY26, though management anticipates short-term margin pressure due to ongoing commodity inflation. The upcoming EL platform and Factory 3.0 are expected to drive future growth and cost efficiencies.

Highlights

  • Overall volumes for FY26 increased by 66%, demonstrating strong growth.

  • Q4 FY26 saw 83,000 units delivered, nearly 80% of the volume from two years prior.

  • Market share significantly improved by 1100bps to 18.6% in Q4 FY26.

  • Store count doubled from 351 to 700 by March '26, expanding reach.

  • EBITDA losses dramatically reduced to negative 2% in Q4 FY26, a 2,000 bps improvement.

  • Pro-Pack attach rate reached a record high of 93% in Q4 FY26, boosting margins.

Concerns

  • Commodity costs (lithium, rare earth magnets, memory, aluminum) are expected to remain inflated, putting pressure on margins.

  • Localized supply chain challenges were noted, particularly in November-December for specific variants.

  • ASP was flat Q-o-Q in Q4 despite price hikes, attributed to offer structuring and expansion into lower-ASP markets.

Key financials

2 periods

Q4

  • Unit Volume
    83,000 units
  • Market Share
    18.6%
  • EBITDA Loss
    -2%
  • Pro-Pack Attach Rate
    93%

FY26

  • Overall Volume Growth
    66%
  • COGS Reduction
    9%

What they filed

Q1 FY27: revenue up 88.7%, net profit up 71.3% against the same quarter last year.

₹ Cr · quarterly
Line itemQ2 FY25Q3 FY25Q4 FY25Q1 FY26Q2 FY26Q3 FY26Q4 FY26Q1 FY27
Revenue584 635 676 645 899 +54%954 +50%1,175 +74%1,217 +89%
EBITDA-139 -141 -172 -134 -132 +5%-72 +49%-70 +59%-33 +75%
Net profit-197 -198 -234 -178 -154 +22%-85 +57%-100 +57%-51 +71%
How to read this

₹ crore, as filed. The percentage beside a figure is the change against the same quarter a year earlier — never the quarter before, which would make every seasonal business look like it collapses and booms each year.

Segment breakdown

SegmentQ4 Market ShareFY25 Market Share
Middle India17.3%4%
Rest of India12%4%
South India23%13%

Capital allocation

high confidence
  • Capex Capex disclosed
    • Factory 3.0 (AURIC) Phase 1 capacity 5,00,000 units
    • Factory 3.0 (AURIC) total planned capacity 10,00,000 units
    We are in the midst of our build-up of Factory 3.0, which is our new capacity, which is the largest capacity and will help us scale up our new platform EL later this year. This is our largest factory till date, initially planned for a 10 lakh total capacity with 5 lakh capacity going live in Phase 1 itself.
  • Liquidity Liquidity disclosed IPO money is sitting in fixed deposits.
    So, that is largely the fixed deposits or the term deposits as we call it, which is the IPO money sitting there.

Guidance & targets

Product Launch

  • EL Platform Commercialization Product Launch · before end of this year (FY27) · High confidence Commercialized and in the field
    expect EL to be commercialized and in the field before end of this year.

    — Tarun Mehta

  • EL Product Launch (Festive Season) Product Launch · by this festive · High confidence Products to come out
    we believe by this festive would be a good timeline for the products to come out.

    — Tarun Mehta

Capacity

  • Factory 3.0 Phase 1 Commencement Capacity · end of this calendar year, Q3 FY '27 · High confidence Commencement of Phase 1
    Expecting commencement of Phase 1 by end of this calendar year, Q3 FY '27.

    — Tarun Mehta

  • Factory 3.0 Full Operationalization (AURIC) Capacity · before end of this FY (FY27) · High confidence 42,000 units/month
    And the full 42,000 should be operationalized before end of this FY for sure.

    — Tarun Mehta

Cost Reduction

  • COGS Reduction (EL-linked) Cost Reduction · by the end of FY '27 · High confidence Largest source of cost reduction
    by the end of FY '27, the largest source of cost reduction and COGS reduction that'll come in a P&L would be largely EL-linked.

    — Tarun Mehta

Expansion

  • New Store Opening Pace Expansion · ongoing · Medium confidence Current pace to continue
    current pace of EC opening on a quarterly basis will more or less continue

    — Tarun Mehta

Pricing

  • Average Selling Price (ASP) Pricing · coming few months · Medium confidence Inch up
    showroom average price in the market, then that will continue to inch up because we've been taking very disciplined price increases every few months.

    — Tarun Mehta

Production

  • New Factory Top Lines Production · Before end of this financial year, most likely Q4 from the new factory. · High confidence Top lines coming
    Before end of this financial year, most likely Q4 from the new factory.

    — Tarun Mehta

What to watch in Q1 FY27

EL Platform Commercialization

before end of this year (FY27)
Current In development, concept vehicles unveiled
Target Commercial launch and in field

Why it matters

Key new product for market expansion and margin improvement.

expect EL to be commercialized and in the field before end of this year.

Risks & concerns

  • Commodity Cost Inflation

    high

    Raw material costs (lithium, rare earth magnets, memory, aluminum) are expected to remain inflated, leading to margin pressure that cannot be fully mitigated despite price hikes and operational work.

    Management acknowledged

  • Localized Supply Chain Challenges

    medium

    Challenges in ramping up supply for specific variants were experienced in Nov-Dec, though mitigated by strategic sourcing and pre-buying to secure production.

    Management acknowledged

  • Flat ASP despite Price Hikes

    medium

    ASP remained flat Q-o-Q in Q4 due to offer structuring and expansion into newer, lower-ASP markets, though management expects ASPs to inch up as stores mature.

    Analyst acknowledged

Q&A highlights

6 direct
Pro-Pack Attach Rates in New Markets Direct
Madhya Pradesh like less than a year ago was at 40%-50% attach rates. Today Madhya Pradesh consistently does more than 80%, 85% attach rates. It takes between two to four quarters for those new stores... to you know sort of become comfortable with the idea of upselling anything beyond the vehicle.

Reveals the ramp-up trajectory and potential for new markets to achieve high attach rates, indicating strong product acceptance and sales team effectiveness.

Asked by Krupashankar

Accelerated Branch Opening Partial
We're not giving any specific guidance for new store expansion in FY '27... For us, the big growth driver in FY '27 and FY '28 is going to be first and foremost EL, followed by the continuous expansion of new stores.

Clarifies that while store expansion will continue, the primary growth driver for the next two fiscal years will be the new EL platform, not necessarily an acceleration of store openings beyond the current pace.

Asked by Krupashankar

Lithium & Commodity Cost Inflation Direct
Lithium particularly was a pretty crazy commodity, has been a pretty crazy commodity, going up from I think a base of $8 per kilogram to about $24 per kilogram in a very short span of time... overall commodity price inflation is between 40 to 50%.

Highlights the significant impact of raw material price increases on BOM and margins, and management's strategy to mitigate this through product design (EL platform) and sourcing.

Asked by Gunjan Prithyani

Market Segment Sizing & EL's Role Direct
EL opens up the mass market for us, where Ather today and, when you look at our price points with Pro-Pack, today Ather actually has no product in the mass market at all. So we're missing almost half of the industry.

Explains the strategic importance of the EL platform in unlocking a large, currently unaddressed market segment (INR1-1.25 lakh), which is crucial for future volume growth.

Asked by Gunjan Prithyani

Delhi EV Policy & Electric Bikes Viability Partial
if there's going to be a very strong pull from the market, I think we'll all build electric motorcycles. They're not rocket science, they're definitely buildable. There's just not been enough or any meaningful proofs that establish them to be a large market yet.

Indicates management's readiness to enter the electric motorcycle segment if market demand materializes, but acknowledges the current focus on scooters and the need for a new platform.

Asked by Gunjan Prithyani

Supply Constraint & New Capacity Ramp-up Direct
current capacity is designed to do 35,000 a month, and now multiple times we've been at 90% to 95% of that utilization over the last few months... AURIC in Phase 1 should unlock 42,000 units a month incremental capacity.

Confirms high utilization of existing capacity and provides specific figures for the incremental capacity expected from the new Factory 3.0, crucial for future growth.

Asked by Kapil Singh

Price Hikes & Cost Reduction Direct
In Quarter 4, we took a roughly about a INR1,000 to INR1,500 kind of a price hike. and in Quarter 1, like basically this April last month, we took on a blended basis about roughly another INR2,500 price hike... by the end of FY '27, the largest source of cost reduction and COGS reduction that'll come in a P&L would be largely EL-linked.

Details the pricing actions taken to offset cost inflation and outlines the long-term strategy for cost reduction through the EL platform.

Asked by Kapil Singh

Depreciation Increase Direct
Ather 450 platform... has a useful life of seven years, and now that platform is amortized and depreciated... because of increase in terms of volume that we do out of the existing plant at Hosur... we have started operating multiple shifts. So, we moved from a single shift to dual shift to a triple shift.

Provides a clear explanation for the increase in depreciation, linking it to the amortization of existing platforms and increased operational intensity due to higher volumes.

Asked by Vipul Agrawal

3 min read 8 chapters

Detailed narrative

FY26 Performance Overview

Ather Energy achieved a breakthrough FY26 with overall volumes growing by 66%, reaching 83,000 units in Q4 alone. The new Rizta product contributed significantly, accounting for almost three-quarters of sales and driving market share to 18.6% in Q4 FY26, up from 8-11%. The company also filed 283 patents in FY26, contributing to a total of 643 patents to date.

Strategic Expansion and Market Share Gains

The company doubled its store count from 351 to 700 by March '26, with 75% of new stores opened by existing dealers. This strategic expansion, particularly in Middle India, led to market share quadrupling from 4% to 17.3% in that region, and growing from 13% to 23% in South India. Service centers also more than doubled during the year.

EBITDA Improvement and Cost Efficiencies

Ather saw a dramatic improvement in EBITDA losses, reducing them by 2,000 bps in Q4 FY26 to negative 2% from negative 23% in FY25. This was supported by a 5 percentage point increase in AGM (with subsidy) to 24% and a 9% reduction in COGS during FY26. The Pro-Pack attach rate reached a record high of 93% in Q4 FY26, significantly contributing to margins.

Commodity Headwinds and Pricing Actions

The company faced significant supply chain challenges and commodity cost inflation, with lithium prices up 2x-2.5x and overall commodity prices rising 40-50%. To mitigate this, Ather implemented price hikes of INR1,000-1,500 in Q4 FY26 and another INR2,500 in Q1 FY27, totaling nearly INR4,000 in the current fiscal year. Management expects short-term margin pressure due to these inflated costs.

EL Platform and Capacity Expansion

The upcoming EL platform, designed for the mass segment (INR1-1.25 lakh), is expected to be commercialized by the end of FY27, offering a substantially better cost structure and improved margins. Factory 3.0 (AURIC) in Chhatrapati Sambhajinagar, with a Phase 1 capacity of 5 lakh units, is slated to commence operations by Q3 FY27, adding 42,000 units/month to current capacity by the end of FY27.

Non-Vehicle Revenue Streams

Ather's non-vehicle revenue streams include Pro-Pack, service, accessories, and charging infrastructure. The accessories division, though currently a sub-INR100 crores P&L, has shown rapid growth of 30-40% in revenue per unit. Management plans to provide more visibility on these segments in coming quarters as they continue to grow.

EV Market Trends and Brand Strength

The EV market is experiencing strong growth, with category searches surging 140% from Q1 to Q4 FY26. Ather's brand metrics improved significantly, with awareness up 100%, consideration up 31%, and preference up 50% over the last 12 months, making it the number one searched EV brand in Q4. This indicates a growing mainstream acceptance of EVs.

Depreciation and Operational Shifts

The increase in depreciation in Q4 was attributed to the amortization of the 450 platform over its 7-year useful life, increased production volumes necessitating a shift to multiple operational shifts (single to dual to triple), and ongoing useful life calibration for tools and jigs. Amortization for the EL platform will begin in the next financial year post production start.

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