Ather Energy shares surge 10% after first quarterly profit of Rs 1.26 crore

Ather Energy posted its first quarterly profit as electric scooter sales lifted revenue. The turnaround comes as capacity constraints and higher input costs test its expansion plans.

In Short

• Ather Energy posted 1st quarterly profit of Rs 1.26 crore in Q2 FY27
• EBITDA turned positive at Rs 74.17 crore, margin improved to 5%
• Input costs remain high but pricing and product mix support growth

Ather Energy reported its first quarterly profit on Monday, posting a net profit of Rs 1.26 crore in the July-September quarter of FY27, compared with a loss of Rs 154.07 crore in the same period last year, as rising demand for electric scooters boosted revenue and improved operating performance.

Shares of the electric two-wheeler maker rose 10% following the announcement.

Revenue from operations increased 62.9% year-on-year to Rs 1,464.24 crore in the second quarter, compared with Rs 898.88 crore a year earlier. The company sold around 93,000 vehicles during the quarter, up 42% from approximately 66,000 units in the year-ago period.

Ather's earnings presentation, filed with the stock exchanges on Monday, showed that earnings before interest, taxes, depreciation and amortisation (EBITDA) turned positive at Rs 74.17 crore, compared with a loss of Rs 90.76 crore in Q2 FY26. Its EBITDA margin improved to 5% from minus 10% a year earlier.

The company attributed the improvement in margins largely to its product mix and pricing decisions, despite higher input costs.

DEMAND OUTPACES PRODUCTION CAPACITY

Ather said demand for its electric scooters continued to rise, putting pressure on its existing production capacity. Its Hosur plant in Tamil Nadu was operating at 98% capacity utilisation, according to the company.

The company's investor presentation showed that enquiries rose 109% year-on-year to around 10 lakh in Q2 FY27, while pre-orders increased 108% to around 1.8 lakh. Ather said the increase in demand had created unrealised retail potential of around 18,000-20,000 units a month.

Wholesale volumes rose 42% year-on-year to 93,211 units, while registrations increased 60% to 92,589 units, including international dispatches, according to the presentation.

Ather plans to add annual production capacity of 75,000 units at its Hosur facility in December. It also plans to add capacity of 1.5 lakh units at its Chhatrapati Sambhajinagar plant in Maharashtra in the second quarter of FY28.

The company said the Hosur expansion includes an investment of Rs 53 crore in a new battery line to diversify its supply chain. Its broader capacity expansion plans are aimed at meeting demand as it scales up production.

KONARC LAUNCH AND PRODUCT MIX SUPPORT GROWTH

During the quarter, Ather launched the Konarc electric scooter, which the company said uses a platform designed to be easier to scale and more efficient to manufacture.

The company is also focusing on higher-range models and increasing the contribution of non-vehicle revenue. Non-vehicle products and services accounted for 15% of revenue in Q2 FY27, compared with 12% a year earlier.

Ather's average selling price increased to Rs 1,33,507 per vehicle in the quarter from Rs 1,20,183 in Q2 FY26. The company attributed the improvement in its adjusted gross margin to structural gains and product-mix management, which partly offset commodity inflation.

Adjusted gross margin stood at 24% in Q2 FY27, compared with 22% in the year-ago quarter.

INPUT COSTS REMAIN A CHALLENGE

Despite the improvement in profitability, Ather flagged pressure from higher commodity costs. Its investor presentation identified aluminium, copper, plastics and memory components as key areas of concern.

The company cited supply disruptions in West Asia and China affecting aluminium, higher copper demand from AI data centres and the energy transition, and supply disruptions in plastics linked to the West Asia conflict. It also pointed to growing demand for high-bandwidth memory used in AI applications, which is affecting the availability and cost of other electronic components.

Ather said these factors had increased input costs, making pricing decisions and product mix important to its margin performance.

Higher fuel prices and concerns about the nationwide rollout of E20 petrol, which contains 20% ethanol, have also supported interest in electric two-wheelers, according to the information provided.

EV MARKET PENETRATION RISES

India's electric two-wheeler market continued to expand during the quarter. Ather's presentation showed that electric two-wheelers accounted for 11.6% of the market in September 2026, their highest-ever penetration level.

Industry registrations reached around 6 lakh units in Q2 FY27, up 82% year-on-year, according to the presentation. Ather's own registrations grew faster, rising 60% year-on-year to 92,589 units.

However, the company's market share stood at 15.1% in Q2 FY27, compared with 17.2% in the year-ago quarter, according to its presentation.

Ather's latest results mark a shift from the losses recorded a year earlier, supported by higher vehicle sales, improved margins and a stronger contribution from non-vehicle revenue. The company's next challenge will be to expand production capacity quickly enough to meet demand while managing input costs and sustaining profitability.

- Ends