Ather Energy share price will be in focus on Thursday after foreign brokerage Nomura reiterated its bullish view on the electric two-wheeler maker and raised its target price.
Nomura believes electric vehicle (EV) penetration in the two-wheeler industry is progressing faster than previously expected, supported by improving product offerings, rising consumer acceptance, favourable total cost of ownership (TCO) and supportive government policies.
The faster pace of EV adoption strengthens the outlook for Ather Energy, according to the brokerage.
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Ather Energy's recent launch of its new electric scooter, Konarc, is aimed at expanding its addressable market through an attractively priced platform.
Nomura expects the company's EL platform to potentially double its total addressable market (TAM). The platform's scalable architecture should enable Ather to offer products at more competitive price points while retaining its technology-led differentiation.
“The success of the new motorcycle platform in the future can provide further upside to our estimates,” Nomura said.
Ather Energy Volume Estimates Raised
Nomura raised its FY28 and FY29 volume estimates for Ather Energy to 7.94 lakh units and 10.16 lakh units, respectively. This represents growth of 104% and 28% year-on-year, respectively.
The brokerage now expects Ather's revenue to grow 54% in FY27, 100% in FY28 and 31% in FY29, with its estimates increasing by 10-11%.
Nomura expects Ather's EBITDA margin to improve from -6.2% in FY27 to 7.6% by FY29. It expects the company to achieve PAT breakeven in FY28.
The brokerage also sees scope for a sharp improvement in margins in FY29 as the production-linked incentive (PLI) scheme benefits for competitors come to an end in March 2028.
“Along with strong growth, Ather's premium positioning keeps long-term margin potential in the range of 15-20%, in our view. Hence, we believe Ather's premium valuation at 5-7x EV/sales should sustain,” Nomura said.
Ather Energy Target Price
Nomura values Ather Energy at 5.5x FY29F EV/sales, with its valuation discounted to September 2027. The brokerage has raised Ather Energy share price target to Rs 1,926 per share from Rs 1,714 earlier.
Nomura has maintained its ‘Buy' rating on Ather Energy and retained the stock as its top pick in the two-wheeler space
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