Mobility Firm Chartered Speed Plans Rs 600 Cr IPO For Fleet, EV Expansion

Even as its monthly run-rate is getting back to pre-pandemic levels amid rising demand for electric vehicles (EVs), Ahmedabad-based intercity and intracity mobility solutions provider Chartered Speed is planning an initial public offering (IPO) of over Rs 600 crore.

The company plans to raise money to back its bus fleet and city footprint expansion plans. From the current 1000-odd fleet of buses, of which roughly five per cent are EVs, Chartered Speed is looking to add another 1,000-1,200 buses in the next one to one and a half years.

Moreover, buoyed by the growing opportunities in electrification of mobility solutions, the company is looking to take up the share of EV buses in its fleet to 50 per cent, said Sanyam Gandhi, whole-time director of Chartered Speed Limited.

"Not only is the supply of EVs increasing but the supply time is also getting reduced even as OEMs and mobility solutions providers are getting to participate in tenders. For urban mobility, we are bidding for more tenders and this is where the IPO comes into the picture. This is because for EV, one needs a longer payment tenure which is not available with banks," said Gandhi.

Unlike its competitors, Chartered Speed not only has presence in more states but also the only player to be working in partnership with state governments that allows it to use public transport infrastructure and ply within city limits during the day.

According to industry research, in the Indian mobility landscape, 86 per cent passengers travel by road of which 63 per cent do so by bus. However, around 47 per cent of India's population lives in states with buses less than the national average of roughly 0.29 buses per 1000 people. India is behind countries like Brazil, China, Japan and Belgium, among others.

It is here that the company is looking to foray into more states, especially those below national average in terms of urban public transport. Chartered Speed is also seeing opportunity in over 150,000 state transport undertakings (STU) buses being tendered for EV operations in the next decade.

The plan for an IPO comes at a time when the company expects to be back to pre-pandemic levels. For instance, Chartered Speed clocked a revenue of Rs 340 crore in FY 2019-20 which fell to Rs 140 crore during the first year of the COVID-19 pandemic in FY 2020-21 and is now expected to touch Rs 200 crore even as monthly run rates are back to pre-pandemic levels.

Going forward, the company is also banking upon retrofitting old internal combustion engine (ICE) vehicles with EV, apart from tapping the transition of urban mobility to green through city authorities' tenders.

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