Ather, Hero look to tech features to boost earnings

Ather, Hero look to tech features to boost earnings

New Delhi, Aug. 18 -- Electric two-wheeler makers are turning to digital features for new revenue, with Ather Energy Ltd doubling non-vehicle revenue through technology packs that offer advanced navigation, intelligence, and safety features, and its largest shareholder Hero MotoCorp Ltd stepping up its focus on software-led earnings.

Bengaluru-based Ather's early bet on monetizing software features paid off in the June quarter as rising adoption of paid features helped it become the first new-age electric two-wheeler maker to break even at the operating-profit level before depreciation and amortization. Revenue from non-vehicle sources, driven by sales of its tech pack, accounted for 14% of total revenue.

This opportunity is not lost on larger incumbents. New Delhi-based Hero MotoCorp, India's largest two-wheeler maker and owner of 29.2% stake in Ather, said in its latest analyst call that it is now looking to aggressively monetize technology features even as it works to reduce losses from its electric scooter business.

"The shift to electric mobility is as much about software as it is about the hardware. At the VIDA Edge program, we view connected features as a core pillar of the ownership journey, enabling us to deliver real-time updates, smart features and personalized services over the vehicle's lifespan," Kausalya Nandakumar, chief business officer of the emerging mobility business unit at Hero MotoCorp, told Mint on Monday.

"As we scale our product line-up and expand our customer footprint, building this digital capabilities stack provides a sustainable lever for margin expansion," she added.

Nandakumar said that the company's connected tech pack was launched this year, and includes real-time updates, smart features, and personalized services.

While Hero offers paid services including navigation, remote vehicle controls, media controls, safety, roadside assistance, and vehicle-health information for Rs.999 a year, Ather's tech stack offers a wider range of features, including Google Maps, AutoHold, advanced trip planning, voice commands and predictive safety features such as pothole alerts, for a one-time payment of Rs.14,000-20,000.

The opportunity also comes as electric vehicle sales are gaining momentum for both Hero and Ather. According to Federation of Automobile Dealers Association (Fada) data, Ather's EV sales grew 83% in 2025-26 to 239,178, while Hero's EV sales rose 196% to 144,330.

Ather's June-quarter earnings saw a meaningful boost from its non-vehicle revenue, which includes sales of its TechStack, accessories, and services. Its revenue from operations nearly doubled compared to the year-ago period to Rs.1,217 crore.

Within this, non-vehicle revenue was Rs.170 crore or about 14%, up 103% year-on-year. While the company doesn't provide an exact breakdown of its non-vehicle revenue, the majority comes from sales of its tech packs to consumers. Compared to the year-ago quarter, the attach rate or the number of consumers who chose to buy the tech pack while purchasing the vehicle, went up from 89% to 94%.

"[In] non-vehicle revenue, the largest piece today for us is the AtherStack Pro, the software pack in our offering, which has done incredibly well for us, even better than we anticipated," Tarun Mehta, Ather's co-founder and chief executive, said in an earnings call on 3 August.

Ravneet Singh Phokela, the chief business officer (CBO) at Ather Energy, told Mint that the company can monetize this only when there is enough depth in software. "In the context of differentiation and product-led differentiation, software is a very important driver of that story from two points of view. One is that it allows us to differentiate and build experiences that are difficult to build otherwise if you don't have a strong prowess and depth in software," Phokela said.

"So, one ability to differentiate at a product level vis-a-vis what's out there. Secondly, the ability to monetize that. You can also monetize that by giving all features in a product; instead of breaking it up as hardware, you can bundle everything and just raise the prices. But the problem with that is that firstly, you are forcing people to buy something, I don't believe it is at least a good strategy," he added.

Bajaj Auto Ltd and TVS Motor Co, Ltd also offer similar software-linked features such as Chetak TecPac and TVS smartxonnect, but have not disclosed any earnings boost from them. Ola Electric Mobility Ltd also has its MoveOS technology pack, which unlocks new features on its vehicles, but hasn't disclosed its earnings from the monetization of the feature.

Globally, companies such as Tesla Inc. have also moved to monetize the advanced software features for a subscription fee.

Bajaj Auto, TVS and Ola did not respond to Mint's emailed request for comments.

However, revenue from tech-related services is not a uniform growth lever for companies, as it depends heavily on brand positioning and software quality, said Deepesh Rathore, founder and head of research at auto consultancy InsightEV.

"Ather has managed to position itself and offer tech features that are finding buyers willing to pay more. For any brand, it will depend on how dependable and delightful the software offerings are. Ather has managed to do that well," he added. Published by HT Digital Content Services with permission from MINT. For any query with respect to this article or any other content requirement, please contact Editor at contentservices@htdigital.in