BENGALURU: Ather Energy's Strategic Move

Ather Energy, the innovative electric scooter manufacturer, is making headlines with its decision to grant employee stock options (Esops) to over 1,300 of its employees. This move, valued at approximately Rs 7 crore, is part of the company's preparations for its anticipated IPO in the first quarter of FY26.

Esops: A Token of Appreciation

During a recent company town hall, founder and CEO Tarun Mehta announced that the Esop program is designed to recognize the contributions of employees across the organization, not just those in senior leadership roles. "Six to 7% of the 1,300 employees are those in senior leadership roles," shared an employee with TOI. The allocation includes a standard grant plus additional units based on tenure.

Esops as a Retention Strategy

Esops have become a significant retention tool among Indian startups, allowing employees to purchase company shares at a predetermined price and potentially reap gains post-listing. Ather's initiative mirrors similar strategies by other high-growth startups aiming to align employee incentives with business growth, a recent example being Swiggy.

Expanding R&D Operations

As per its draft red herring prospectus (DRHP) filed in September 2024, Ather reported having 1,426 full-time employees, with 731 dedicated to research and development, making up about 46% of its workforce. The company has recently expanded its R&D capabilities with the launch of 'The Juggernaut,' a state-of-the-art product testing and validation center in Bengaluru.

IPO Plans Unveiled

Ather's IPO strategy includes a fresh issue of equity shares worth Rs 3,100 crore and an offer-for-sale of 2.2 crore shares by promoters and investors, as outlined in the DRHP.