Amara Raja Energy
Stock Snapshot
Price Performance
Vista Outlook
Basis of our Recommendation
Amara Raja Energy & Mobility (ARE&M) is navigating a pivotal transition, balancing robust growth in its core lead-acid battery segment with significant investments in new energy technologies. Management's commentary highlights a strong domestic demand for lead-acid batteries, driven by automotive and industrial sectors, while also acknowledging near-term profitability pressures from elevated raw material costs and strategic spending. The company's focus on Energy Storage Systems (ESS) is crucial, as it aims to leverage upcoming capacity to enhance margins and market share in the lithium-ion space. Vista's financial outlook reflects an expectation of accelerating revenue growth, supported by the strategic pivot towards renewable energy storage and the commissioning of new facilities. However, challenges such as reliance on Chinese supply chains and potential delays in technology validation pose risks. The industry context remains favorable, with government initiatives bolstering domestic manufacturing and improving pricing power. Over the next 12-24 months, key opportunities include scaling up the BESS facility and capturing market share in the lithium-ion sector, while watchpoints include commodity price volatility and execution risks in new technology deployments
Why We Like This Stock
- Strong domestic demand for lead-acid batteries supports revenue stability
- Strategic investments in Energy Storage Systems are expected to enhance long-term margins
- Government initiatives are fostering a favorable environment for domestic manufacturing
Things To Watch Out For
- Elevated raw material costs are pressuring near-term profitability
- Reliance on Chinese supply chains poses risks to supply stability
- Execution challenges in scaling new energy technologies could impact growth
Key Parameters
Financial Snapshot
View Technicals Analysis →| Actuals | Forecast | ||||
|---|---|---|---|---|---|
| FY24 | FY25 | FY26 | FY27 | FY28 | |
| Revenue (Cr.) | 11,708 | 12,846 | 13,814 | 15,420 | 17,442 |
| Profit Before Tax (Cr.) | 1,229 | 1,137 | 952 | 993 | 1,212 |
| PBT Margin | 10.5% | 8.9% | 6.9% | 6.4% | 6.9% |
| Net Profit (Cr.) | 910 | 857 | 699 | 727 | 887 |
| Earnings Per Share | 49.7 | 46.8 | 38.2 | 39.7 | 48.5 |
Analyst Recommendations
| Broker | Recommendation | Target Price | Date |
|---|---|---|---|
| Anand Rathi | ► Neutral | 1,080 | 13-Aug-2026 |
| JPMorgan | ► Neutral | 1,070 | 12-Aug-2026 |
| Motilal Oswal | ► Neutral | 944 | 12-Aug-2026 |
| Nomura | ► Neutral | 1,048 | 12-Aug-2026 |
| Nuvama | ▲ Buy | 1,130 | 05-Aug-2026 |
| Morgan Stanley | ▼ Underweight | 875 | 26-May-2026 |
Company Overview
Show Company Profile
Amara Raja Energy & Mobility Limited, together with its subsidiaries, manufactures and sells lead-acid storage batteries for industrial and automotive applications in India and internationally. It operates in two segments, Lead Acid Batteries and Allied Products; and New Energy Business. The company provides new energy business related products; installation, commissioning, and maintenance services; and industrial chargers, integrated power systems, electric charging solutions, and battery energy storage systems, as well as lithium-based home UPS systems and hybrid inverter platforms for residential and small commercial applications. It also develops, manufactures, and sells energy storage and management products, solutions, and technologies related to lithium cells, advanced cell chemistries, battery packs, and components. The company sells its batteries under the Amaron, PowerZone, Power Stack, AmaronVolt, Amaron Brute, Amaron Sleek, ELITO, and Quanta brands. The company supplies its batteries to various customer groups, such as telecom, railways, solar, motive, power control, international operations, defence, and UPS; and automobile original equipment manufacturers, replacement markets, and private label customers. The company was formerly known as Amara Raja Batteries Limited and changed its name to Amara Raja Energy & Mobility Limited in September 2023. Amara Raja Energy & Mobility Limited was incorporated in 1985 and is based in Hyderabad, India.