1. At a Glance
Amara Raja Energy & Mobility Ltd (formerly Amara Raja Batteries) is India’s battery behemoth that’s been keeping everything from your scooter to telecom towers alive, and is now charging (pun intended) into lithium. With 96% of revenue still from lead-acid batteries and only 4% from its New Energy Business, it’s a reminder that revolutions take time… especially when you’re making ₹12,000+ Cr a year selling the old tech. Debt is minimal, distribution is massive, and a 16 GWh giga factory is on the horizon. If Exide is the “uncle” of Indian batteries, Amara Raja is the cousin who just discovered EVs.
2. Introduction
Think of Amara Raja as the person who has been running a successful grocery store for decades, now opening an organic café on the side because the kids are into that stuff. The grocery store = lead-acid batteries (Amaron, Powerzone, Quanta), the café = lithium-ion cells and EV packs.
The company dominates Indian industrial batteries (telecom, UPS, railways) and is a strong No. 2 in automotive batteries after Exide. Internationally, it’s in 50+ countries, but 88% of revenue is still from India.
Recent years brought some drama — a fire wiped out ₹700 Cr revenue capacity in tubular batteries (insurance softened the blow), environmental disputes in Andhra Pradesh went to court, and the tie-up with Johnson Controls ended. But the big pivot is underway: lithium cell manufacturing, EV battery packs, recycling plants, and a 16 GWh giga factory.
3. Business Model (WTF Do They Even Do?)
1. Lead Acid Batteries (96% revenue)
- Automotive:2W, 3W, 4W, CV batteries for OEMs & aftermarket.
- Industrial:VRLA batteries for telecom, UPS, railways, power sector.
- Brands:Amaron, Powerzone, Elito, Quanta, Volt, Brute.
- Market Share:33-34% aftermarket, 57-58% industrial, 42-43% UPS.
2. New Energy Business (4% revenue)
- Lithium-ion cells (India’s first 21700 NMC 811 cylindrical cell).
- Battery packs & chargers for EVs and stationary storage.
- Clients include Piaggio, Mahindra, BSNL, Indus Tower.
Moat:Huge
distribution network — 1 lakh+ retail points, 550+ Amaron franchises.
4. Financials Overview
| Metric | Q1 FY26 | Q1 FY25 | Q4 FY25 | YoY % | QoQ % |
|---|---|---|---|---|---|
| Revenue (₹ Cr) | 3,401 | 3,131 | 2,974 | 8.6% | 14.3% |
| EBITDA (₹ Cr) | 387 | 430 | 342 | -10.0% | 13.2% |
| PAT (₹ Cr) | 194 | 245 | 167 | -20.8% | 16.2% |
| EPS (₹) | 10.60 | 13.36 | 9.11 | -20.7% | 16.3% |
Commentary:
- YoY profit drop despite revenue growth → margin compression from higher input costs & NEB ramp-up expenses.
- EBITDA margin at ~12% this quarter — lower than the 14-15% historical comfort zone.
- Annualised EPS ~₹42.4 → P/E ≈ 22.4x at ₹953.
5. Valuation (Fair Value RANGE only)
Method 1: P/E
- Sector median for auto components ≈ 22–25x.
- On FY26E EPS ₹45, FV range = ₹990 – ₹1,125.
Method 2: EV/EBITDA
- TTM EBITDA = ₹1,585 Cr; sector EV/EBITDA ≈ 11–13x.
- EV range ₹17,435 – ₹20,605 Cr → Equity FV/share: ₹950 – ₹1,120.
Method 3: DCF
- Assuming 8% CAGR in LAB, 30% CAGR in NEB over 5 years, WACC 11%, terminal growth 4% → ₹940 – ₹1,150.
Fair Value RANGE:₹940 – ₹1,125Disclaimer:This FV range is for educational purposes only and is not investment advice.
6. What’s Cooking – News, Triggers, Drama
- Giga Factory in Telangana:16 GWh cell capacity + 5 GWh battery pack assembly;
