Naxatra Labs Secures $3M to Power India’s Self-Reliant EV Revolution with Indigenous Motor Tech

In a significant move for India’s electric mobility infrastructure, Bengaluru-based deep-tech startup Naxatra Labs has raised $3 million in a funding round led by Rainmatter, the investment arm of Zerodha founder Nithin Kamath. This investment will accelerate the development of the startup’s core technology: high-efficiency, indigenously designed electric motors and controllers, a critical component often overlooked in the EV boom. Founded by Siddharth Dialani and Aditya Agrawal, Naxatra Labs is tackling a vital gap in the supply chain, aiming to reduce India’s heavy import reliance on key EV components and build affordable, high-performance solutions tailored for the Indian market and beyond.

The Core Challenge: Import Dependence in a Critical Component

While India’s EV market is projected to be worth over $200 billion, a significant portion of the value—especially in high-tech components like electric motors and power electronics—is captured by foreign suppliers. Electric motors are the heart of any EV, determining its efficiency, torque, range, and overall performance. Currently, most Indian EV manufacturers import motors or rely on foreign designs, which can be costly, less optimized for local conditions, and create supply chain vulnerabilities.

Naxatra Labs was founded to address this exact problem. The company specializes in designing and developing axial flux motors, a more advanced and compact design compared to traditional radial flux motors. Axial flux motors offer higher power density (more power in a smaller, lighter package) and greater efficiency—key advantages for electric two-wheelers, three-wheelers, and other lightweight vehicles that dominate the Indian market. By building this technology locally, Naxatra aims to slash costs, improve performance, and give Indian OEMs (Original Equipment Manufacturers) a competitive edge.

Strategic Use of Capital: From R&D to Road

The $3 million infusion will be strategically deployed to advance Naxatra Labs from a promising deep-tech venture to a commercial-scale component supplier.

1. Accelerated R&D and Prototyping: A core focus will be on further refining their axial flux motor designs and developing robust, intelligent motor controllers. This includes enhancing thermal management, durability for India’s diverse climate and road conditions, and software integration for optimal performance.
2. Talent Acquisition: Building world-class motor technology requires specialized talent in electromagnetics, materials science, power electronics, and thermal engineering. The funding will enable Naxatra to attract top engineers and researchers to its Bengaluru base.
3. Pilot Scaling and Manufacturing Readiness: The capital will support the creation of advanced prototypes and pilot production lines. This is a crucial step to validate their technology with vehicle manufacturers, secure design wins, and prepare for volume manufacturing.

Why This Investment is a Bellwether

The Rainmatter-led round is noteworthy for several reasons, signaling broader trends in the Indian startup ecosystem.

• Investor Confidence in Deep-Tech: This funding is a clear example of the $1.55 billion surge in deep-tech investments India witnessed in 2025. Investors are moving beyond consumer internet apps to back foundational, hardware-heavy innovation with long-term strategic importance.
• Strategic Focus on EV Infrastructure: The investment highlights a maturing perspective on electric mobility. Capital is now flowing not just into vehicle manufacturers (OEMs) but into the essential supply chain and infrastructure that will make the transition sustainable and profitable. Building sovereign capabilities in motors, batteries, and semiconductors is seen as critical.
• Alignment with National Policy: Naxatra’s mission dovetails perfectly with the government’s Atmanirbhar Bharat (Self-Reliant India) vision and the anticipated FAME III (Faster Adoption and Manufacturing of Electric Vehicles) policy. By developing indigenous motor technology, the startup directly contributes to reducing import bills, creating high-skilled jobs, and securing the domestic EV industry’s future.
• The “Rainmatter” Signal: An investment from Nithin Kamath’s Rainmatter carries significant weight. Known for backing sustainable and impactful businesses, their involvement validates Naxatra’s technical approach and market potential, often encouraging follow-on interest from other investors.

The Road Ahead: Powering the Next Wave

For Naxatra Labs, the path forward involves transitioning from successful prototypes to becoming a trusted Tier-1 supplier for major EV manufacturers. The challenges are substantial—scaling precision manufacturing, ensuring consistent quality, and competing with established global players on cost and reliability.

However, the opportunity is immense. As CEO Siddharth Dialani stated, they are building “motor tech that’s efficient, affordable, and India-first.” Success would mean that a future generation of “Made in India” electric scooters, rickshaws, and even cars could be powered by motors designed and built in India, optimizing them for local use while potentially exporting this technology to other emerging markets.

For the ecosystem, Naxatra’s journey is a test case. It demonstrates whether Indian deep-tech startups can innovate in complex hardware domains, attract patient capital, and successfully integrate into global supply chains. If they succeed, they won’t just be powering vehicles; they’ll be powering a more self-reliant and technologically advanced Indian economy.