Kinetic Green Energy and Power Solutions, the e-mobility venture of the Kinetic Group, is looking to raise up to $100 million by selling 10-15% stake in the company to investors, said people in the know.
The company plans to raise the money in two tranches and expects to close the first of $50 million this year.
Sulajja Firodia Motwani, Kinetic Green Energy’s chief executive officer, confirmed the plan.
“We are now ready for a giant leap. We see that adoption of electric vehicles is now seeing considerable jump due to higher customer awareness and inclination to consider EVs as their next purchase,” Motwani told ET.
If successful, this will be the first external investment in the company which has so far been funded internally by the Kinetic Group.
Motwani said the capital will be used for setting up a manufacturing plant at Supa, Maharashtra, capable of producing 1 million electric scooters annually, for research and development, and for brand-building.
The fundraising plan comes at a time when investors have turned cautious of investing in mobility (or e-mobility) companies amid rising interest rates. Companies like Tata Motors and Mahindra and Mahindra have suspended their fundraising plans for their EV arms after getting bids at lower-than-expected valuations, ET had reported earlier.
“Many mobility startups and component companies are struggling to raise capital,” said one consultant working with the automotive industry. “Investors are keener on the bottom line than the top line,” the consultant said, requesting not to be named.
Kinetic Green had started a fund-raising exercise towards the end of 2021, but it did not go through. Motwani blamed it on the third wave of Covid-19 infections in India that happened soon after.
“Now we feel it’s the right time to infuse additional capital,” she said. “Back then, we were only in e-three-wheelers. Now with e-two-wheelers, it gives the investor that much more confidence in the business and a better valuation.”
Kinetic Green has a network of 500 exclusive dealers across India. It had a top line of Rs 300 crore in FY23. Motwani claimed the company was profitable but did not share any details.
The company is targeting a top line of Rs 10,000 crore per year in the coming five years from its portfolio of electric two- and three-wheelers.
Kinetic Green had started operations in 2015 as an electric three-wheeler maker. It entered the electric two-wheeler market in 2021, after the completion of a non-compete period with its erstwhile two-wheeler partner Mahindra Two Wheelers.
The company has tied up with China’s leading electric two-wheeler maker Aima Technology Group for making electric two-wheelers in India. The company is also reviving the Kinetic Group’s iconic Luna brand in an electric avatar.
Kinetic Green is understood to have received interest from investors on the back of a sustainable and profitable business model, which till now has been built with proprietary capital.
“We are not burdened by any baggage that typical legacy players carry and yet, possess the brand and the network where the newage players are found wanting,” said Motwani.
Two-thirds of this revenue is expected from the electric two-wheeler business and the rest from its electric three-wheeler segment. The company will also be investing in core technology like batteries and advanced powertrain systems. Part of the fund shall also be deployed for development of differentiated products in technological partnerships with brands like Tonino Lamborghini and the Aima Tech.
