InvestorQ : Can you tell me about the big shift that Amara Raja Batteries is planning towards electric vehicles?
vaishnavi mhatre made post

Can you tell me about the big shift that Amara Raja Batteries is planning towards electric vehicles?

vidhya Laxmi answered.
2 weeks ago

Amara Raja Batteries, India’s second largest automobile battery player, has finally made some grand plans for its entry into the EV battery and support system space. In the last few quarters, there have been questions over whether Amara Raja was capable of managing the change from acid lead batteries to EV batteries. Now the company has actually put out its game plan and investment outlays with a clear chart going forward. Here is a gist of the EV foray that Amara Raja Batteries is planning in the EV automotive batteries space.

Currently, it has a limited focus only on the 3-wheeler EV segment and the plan is to expand its franchise to all kinds of EVs. Secondly, for the EV automobile sector, Amara Raja will offer a combination of renewable vitality markets and vitality storage techniques. To pursue that goal, it has already initiated the merger of its infrastructure and energy enterprises, which is expected to be completed by December 2022. IN addition, Amara Raja Batteries also has grand plans to invest another Rs7,000 crore or close to $900 million in EV boost.

BY FY25, Amara Raja plans to grow its turnover 2.5 times from the current Rs1,200 crore to Rs3,000 crore. This will be partially aided by the merger of the infrastructure and energy enterprises of the Amara Raja group. In addition, the company is also investing nearly $900 million to reinforce its EV foray, beyond the current dominance in lead acid batteries. The fresh investment will be in a lithium-ion facility, which is the normal protocol for EV batteries. This will aid their big foray into EVs.

It plans a more comprehensive solution. Apart from providing its battery packs to battery electrical automobiles, Amara Raja Batteries will also provide battery packs for functions like vitality storage. Amara Raja has already developed a technologically superior energy electronics group, which will focus on swapping and charging infrastructure and other futuristic enterprises. The merger is already approved by the shareholders and bankers and only the NCLT final order is yet to arrive.

Here are some takeaways. Its growth will be triggered by the railways enterprise and the renewable and information centre enterprises. Renewables already has a portfolio of 700 MW photovoltaic models, of which 200 MW is commissioned and 500 MW is under execution. It also expects the solar segment to be a big growth story. Another big bet is on inexperienced hydrogen for mobility and industrial sector. For this, it will focus on the steel, cement and fertilisers sector.