Ather Energy Turns Focus On ‘Middle India’ As Q1 Losses Shrink

EV major Ather Energy is turning its focus to what it calls Middle India, a region that spans across states like Gujarat, Maharashtra, Madhya Pradesh, Chhattisgarh, and Odisha, to raise its market share and boost sales in FY26, cofounder and CEO Tarun Mehta said in a post-earnings call today. 

The company, according to him, believes this region, historically underserved by the electric vehicle (EV) companies, presents significant headroom for growth through rapid distribution expansion. The shift has shown results, with Mehta saying that Ather’s market share in these states climbed 10.7% in Q1, more than doubling over last year.

The EV major’s efforts to widen its presence included adding 95 stores in Q1, which took the total to 446. Most of this expansion was concentrated in what it calls Middle India, and the company plans to retain this geographic focus. 

South India, where Ather leads in markets like Tamil Nadu and Karnataka, will see a continued consolidation of its stronghold. North India, which includes Rajasthan and the Northeast, is next in line for aggressive rollout.

This comes as Ather Energy narrowed its Q1 FY26 net loss by 3% YoY to INR 178.2 Cr and by 24% QoQ, while revenue surged 79% YoY to INR 644.6 Cr, but dipped 5% sequentially. The EBITDA loss improved to INR 106 Cr, with EBITDA margin rising to -16% from -33% YoY.

The company sold 46,000 scooters, making a 97% on-year jump, but saw a slight sequential and a 10% decline in average revenue per vehicle.

At the same time, Ather also managed to reduce its average order value (AOV). This, as per the company, was achieved through a combination of favourable product mix, value engineering, and strong brand pricing power. Even as government subsidies were slashed by INR 5,000 per vehicle, realisation per unit held steady due to rising adoption of higher-margin SKUs and services.

What’s Ahead For Ather?

In the earnings call, Mehta acknowledged short-term supply concerns related to rare earth magnets following export restrictions from China. While the impact in Q2 is expected to be limited to about a week’s worth of supply, Ather is exploring alternatives like shifting from heavy rare earth magnets to lighter variants or even ferrite-based solutions. 

“This won’t be a production stoppage for seven days, rather a potential shortfall in our ability to fully meet dealer demand, possibly lasting up to a week over the entire quarter. Naturally, our teams are working hard to minimise this impact. A few months ago, the expected gap was larger, but strong R&D efforts have significantly narrowed it,” Mehta explained. 

He said that there might be some impact on retail. “I’d be remiss to claim otherwise, especially since channel inventory levels aren’t particularly high. However, that’s where having a distribution channel helps, the impact on retail should be less severe than the supply gap itself.” 

On the product front, the company will unveil its EL platform later this month. Designed to be a cost-efficient and scalable scooter platform, EL is expected to help Ather expand both its volume and margin. Products on this platform will likely be manufactured at the upcoming ‘Factory 3.0’ facility in Aurangabad. 

While timelines for launch remain under wraps, Mehta confirmed that the platform will be used across geographies rather than being confined to lower-income states.

Ather is also working on a mid-performance motorcycle platform aimed at the 150–180cc equivalent segment, though this will not hit the market in FY26. The current priority remains on scooters and the EL rollout, said Mehta.

According to him, accessories and charging infrastructure are now contributing more meaningfully to revenues. He said that per-vehicle accessory sales also improved in Q1, and software subscriptions remained resilient across geographies. The company also added 400 charging points, taking the total to 4,000.

Looking ahead, Ather expects further margin improvement and a potential expansion in non-vehicle revenue as the installed base grows. Operating team costs will rise gradually with the company’s expansion, while R&D and corporate headcounts have largely stabilised.

Mehta welcomed the arrival of legacy Japanese two-wheeler brands into the electric market, suggesting that such moves will improve EV visibility and adoption among mainstream buyers.