01 — At a Glance
The Battery King Trying to Avoid Being a Museum Piece
- 52-Week High / Low₹1,109 / ₹777
- CMP (12 Mar 2026)₹803
- TTM Revenue₹13,063 Cr
- TTM PAT₹755 Cr
- Q3 FY26 EPS₹8.29
- Book Value₹425
- Price to Book1.89x
- Dividend Yield1.35%
- Debt / Equity0.04x
- Return 3 Months-15.0%
The Setup: Amara Raja closed Q3 FY26 with ₹3,351 crore quarterly revenue (+5.9% YoY), ₹183 crore PAT (-22.1% YoY), but here’s the thing—New Energy (lithium packs, chargers, BESS) just hit ₹200+ crore in a single quarter for the first time ever. That’s growth the old battery business can no longer provide. The stock punished it anyway with a -15% three-month return because nothing says “confidence” like running away from transformation.
02 — Introduction
Your Grandfather’s Battery Company Is Slowly Turning Into Your Dad’s Energy Company
Let’s talk about Amara Raja Batteries. Or as we must now call it, Amara Raja Energy & Mobility—a name change that screams “we know where this is headed.” Since 1985, when it started as a small valve-regulated lead-acid (VRLA) battery maker, it’s been the king of Indian battery markets. Amaron is the largest aftermarket automotive battery brand. Period. In telecom? 55–60% market share at one point. Industrial? Still a juggernaut despite headwinds.
But here’s the plot twist: lead-acid batteries are functionally perfect at doing one thing and one thing only—storing electrical energy in the dumbest, heaviest way possible. They’re also 150 years old. Lithium batteries are 40 years old and getting exponentially better. Do the maths.
Q3 FY26 was the inflection quarter. New Energy revenue crossed ₹200 crore. Telecom business (which was 15–20% of revenue two years ago) fell off a 45% cliff. The company announced a 5 GWh BESS (Battery Energy Storage System) project with ₹280 crore capex. The giga factory in Telangana (16 GWh lithium-ion capacity by 2030) is now real, funded, and under construction. The Rs. 1,400 crore already invested in the lithium subsidiary is locked in. And management is basically telling analysts: “Yes, this is uncomfortable. Yes, the old business is shrinking. Yes, we’re building new legs while walking on old ones. Welcome to disruption.”
The stock fell 15% in three months because markets hate stories where the ending is uncertain. Let’s see if the data makes a stronger argument.
Feb 2026 Concall Note: Management on New Energy: “first quarter in which we crossed the ₹200 crores revenue milestone.” Also, on BESS: “5 GWh integrated solution plant for grid and C&I storage…capex INR 280 cr…commissioning target end FY27.” Translation: transformation is real and it’s happening now.
03 — Business Model: Two Entirely Different Companies Living in One P&L
The Lead Acid Cemetery and the Lithium Baby
Segment 1: Lead Acid Batteries (93% of Q3 FY26 revenue)
Amara Raja manufactures lead-acid batteries for automotive (OEM + aftermarket), industrial (UPS, telecom, railways), home inverters, and tubular applications. 55 million units of automotive capacity. 2.3 billion Ah of industrial capacity. Distribution? 23 branches, 39 distribution points, 550+ Amaron franchises, and 100,000+ points of sale across India. Exports to 50+ countries. Market position: largest aftermarket player in India. Latest problem: telecom segment in free fall (down 45% YoY in Q3).
Segment 2: New Energy Business (7% of Q3 FY26 revenue, growing at 100%+ YoY)
Amara Raja Advanced Cell Technology (ARACT) subsidiary manufactures lithium-ion cells (NMC and LFP chemistry), battery packs, chargers, and energy storage systems. Current focus: pack assembly for telecom towers (trading model—buy cells, assemble packs, ship). Upcoming: proprietary NMC 811 cell manufacturing. Even-more-upcoming: BESS (Battery Energy Storage Systems) for grid and commercial & industrial applications. Giga factory capacity: 16 GWh (lithium) + 5 GWh (packs). Timeline: Phase 1 to start early 2027.
Automotive Market Share33–34%Aftermarket Dominance
Industrial Market Share57–58%VRLA Fortress
UPS Market Share42–43%Steady Moat
New Energy Revenue (Q3)₹200+ CrFirst Time Crossed
The Brutal Math: Lead-acid is a ₹12,000+ crore TAM in India with slowing growth and structural headwinds from EV adoption. Lithium (including BESS, mobility, and grid storage) is a ₹50,000–100,000 crore TAM with 40–50% CAGR. Amara Raja is 5% of the old business TAM. It will be <5% of the new TAM unless it scales aggressively. The capex (₹9,500 crore over 10 years) is the company's bet that it can make that leap.
💬 What bothers you more: a legacy business with 33% market share shrinking 10% a year, or a new business with 5% market share growing 100% a year? Drop your thesis below.
04 — Financials Overview: Q3 FY26
The Quarterly Results — Where the Growth Story Hides
Result Type: Quarterly Results | Q3 FY26 EPS: ₹8.29 | Annualised EPS (Q3×4): ₹33.16 | TTM EPS: ₹44.5
| Metric (₹ Cr) |
Q3 FY26
Dec 2025 |
Q3 FY25
Dec 2024 |
Q2 FY26
Sep 2025 |
YoY % |
QoQ % |
| Revenue | 3,351 | 3,164 | 3,388 | +5.9% | -1.1% |
| Operating Profit | 374 | 416 | 406 | -10.1% | -7.9% |
| OPM % | 11.2% | 13.1% | 12% | -190 bps | -80 bps |
| PAT | 152 | 195 | 182 | -22.1% | -16.5% |
| EPS (₹) | 8.29 | 10.65 | 9.96 | -22.1% | -16.7% |
The Margin Massacre: OPM fell 190 basis points YoY, from 13.1% to 11.2%. The culprits? (1) Telecom telecom segment collapse meant losing a higher-margin revenue stream. (2) Raw material inflation (tin alloys, sulfuric acid, antimony) hit LAB operations hard. (3) OEM mix within automotive (lower margin) took share from aftermarket (higher margin). (4) Tubular plant restart costs. (5) New energy business trading at low margins. What saved it? Lead recycling plant delivered 60bps of EBITDA margin accretion. Without it, OPM would have been 10.6%. Also, Management already executed a ~2% price hike in Jan ’26. More to come, probably.
05 — Valuation: Fair Value Range
What’s This Battery Company Actually Worth?
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