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Amara Raja embarks on expansion drive
Amara Raja Batteries Limited, engaged in the business of manufacture and sale of lead acid storage batteries for industrial and automotive applications, is in the process of scaling up its two-wheeler batteries’ manufacturing capacity from the existing 11 million units a year to 25 million units per year.
To ramp up 2-wheeler, 4-wheeler battery capacities to meet growth in demand
Hyderabad: Amara Raja Batteries Limited, engaged in the business of manufacture and sale of lead acid storage batteries for industrial and automotive applications, is in the process of scaling up its two-wheeler batteries’ manufacturing capacity from the existing 11 million units a year to 25 million units per year.
The four-phase expansion plan, staggered over the last four years, has been reviewed by the company’s board of directors in view of the anticipatory growth in demand for two-wheeler batteries. The board has also approved the setting up of necessary infrastructure for the entire expansion. The first phase, comprising three lines, would take the capacity to 15 million units a year.
“The board had already approved the expansion of four-wheeler battery manufacturing capacity from 8.25 million units to 11 million units a year,” Amara Raja said in a statement on Wednesday.
Amara Raja has witnessed a 6.86 per cent jump in its net profit to Rs 109 crore for the fourth quarter ending March 2016, as against Rs 102 crore in the corresponding quarter of the last fiscal. Its net sales stood at Rs 1,170 crore in the quarter under review, as against Rs 1,067 crore during the same period last year, reflecting a growth of 9.65 per cent.
For the full year ended March 2016, the company has reported a net profit of Rs 489 crore, recording a growth of 18.97 per cent as against Rs 411 crore of the previous year, while its revenues stood at Rs 4,691 crore, as compared with Rs 4,211 crore in FY 2014-15, registering a growth of 11.39 per cent.
Attributing the increase in profitability and top line to the strong double-digit revenue growth in the company’s automotive battery division, supported by very good volume increase in four-wheeler and two-wheeler batteries, Amara Raja said that in the four-wheeler and two-wheeler aftermarket segment, both the brands, Amaron and PowerZone continued their high-growth, supported by introduction of newer products, expansion of channel and leveraging the strong brand and customer relationships.
“We are pleased to continue the growth momentum of the company’s turnover and profits and achieve impressive all round growth despite uncertainties in the economic conditions. We have created adequate capacities for further growth of business and also brand visibility,” said Jayadev Galla, Vice-Chairman and Managing Director of Amara Raja Batteries. Amara Raja’s scrip ended the trade at Rs 850.85 on the BSE on Wednesday, down 4.87 per cent, over the previous close of 894.45 a share.
