Southeast Asian investors bullish on electric bikes, clean energy in 2024

Two-wheeled electric vehicles, sustainable agriculture, and renewable energy are among the big themes in climate tech that Southeast Asian investors are looking out for in 2024.

Investor interest in climate tech has been growing over the past five years. In 2023, there have been 15 such deals worth a total of US$156.6 million in the region, according to startup data platform Tracxn.

The largest deals include three companies in the two-wheeler EV space: Indonesia’s Alva, which raised US$50 million; Maka Motors, which secured US$37.6 million; and Singapore’s Ion Mobility, which received US$18.7 million.

Electric two-wheelers are likely to remain a key theme to watch in 2024. Several Southeast Asian countries, such as Indonesia and Vietnam, are already emerging as manufacturing hubs for EV components and batteries, Anand Veeraraghavan, managing director at the Boston Consulting Group in Singapore, told The Business Times.

“For 2024, we might also see investments to prepare for the introduction of local-brand EV models in both the two-wheeler and four-wheeler space, with national and investor interest to develop such capabilities in the near term.”

Paul Ong, partner at venture debt provider InnoVen Capital, sees a “huge opportunity to grow very large companies” in this space. His firm has backed e-bike makers Dat Bike in Vietnam and Ather Energy in India.

Photo credit: Dat Bike

Ong expects more growth and focus around EV-associated products, such as charging infrastructure, battery swapping, and EV consumer financing.

“You need the consumer financing angle to really unlock the adoption of EV two-wheelers in the region,” he added.

Singapore-based Golden Gate Ventures is likewise optimistic about electric two-wheelers, having looked into opportunities in smart battery production and vehicle manufacturing, said partner Michael Lints.

He said there’s a big opportunity because the prices of EV scooters are expected to go down over time as batteries become cheaper and manufacturing efficiency improves.

“I think we’ll see a massive market for those specific scooters in markets like Vietnam, Malaysia to an extent, and Indonesia as well,” he added.

Energy transition

Another big theme for climate tech investors is renewables.

Southeast Asia has been playing a key role in the ramping up of solar solutions and is emerging as one of the fastest-growing solar energy markets, said Lim Wen Bin, partner for infrastructure advisory at KPMG in Singapore.

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