The 16 reports from 8 analysts offering long term price targets
for Amara Raja Batteries Ltd. have an average target of 781.13. The consensus estimate
represents a downside of -0.71%
from the last price of 786.75.
Amara Raja's future technology partnerships (after the exit of Johnson Controls) and its ability to foray into alternative battery chemistries will determine its growth opportunities in the long term. We initiate on Amara Raja Batteries with an ADD rating. Currently, the company has a ~20% market share in the USD 5bn lead-acid battery (LAB) segment. We expect it to gain further share as revenues are forecasted to grow in double digits over the next 3-5 years (vs. mid-single-digit for the industry). While Amara Raja would benefit from the shift towards the organised segment in the near term, we believe that the advent of new technologies such as lithium-ion will change industry dynamics; though the pace of adoption is expected to be very gradual.
Background: Amara Raja Batteries Ltd (ARBL) is the second largest automotive battery manufacturer and the largest supplier of industrial storage batteries in India. JCI, the global leader in lead-acid automotive batteries and advanced batteries for start-stop, hybrid and electric vehicles, provides technical support to ARBL. Company's business model is de-risked as it caters to automotive as well as industrial segments. Sales are...
Amara Raja Batteries Ltd (ARBL) is India's second largest Lead-acid battery manufacturer. Its segment include 70% from automotive & rest from industrial with a market leadership in Telecom segment. During Q1FY21, ARBL revenue came at 37%YoY due to subdued auto demand and lockdown. However, pickup in auto replacement market and in telecom sector has offset further decline. EBITDA margin came at 13.2% better than expected due to lower lead price and cost control initiatives. Material cost lowered by 110bps....
Amara Raja Batteries Ltd (ARBL) is India's second largest Lead-acid battery manufacturer. Its segment include automotive and industrial lead acid batteries, with market leadership in Telecom segment. Under challenging market condition domestic replacement demand and export has substantially overcome the demand slowdown in Auto OE segment aided by significant traction in volume growth. During Q4FY20, ARBL revenue came flat at 0.9%YoY, (marginally inline with our estimate). PAT grew by 14.5%YoY. Despite weak demand, EBITDA margin came at above 15% (-10bps),...
Background: Amara Raja Batteries Ltd (ARBL) is the second largest automotive battery manufacturer and the largest supplier of industrial storage batteries in India. JCI, the global leader in lead-acid automotive batteries and advanced batteries for start-stop, hybrid and electric vehicles, provides technical support to ARBL. Company's business model is de-risked as it caters to automotive as well as industrial segments. Sales are...
We expect margin trajectory to be better than most ancillaries on the back of (1) sustained strength of automotive replacement segment in overall mix, (2) benign outlook for lead prices (currently at ~US$1635/tonne vs. Q4FY20 average of ~US$1800/tonne). B2C nature of aftermarket, inherent pricing power (near oligopoly on supply side, demand is fragmented) are seen leading to flattish margin performance in FY21E (negating impact of limited...
decline in volume in the auto OEM segment was offset by growth in the domestic replacement segment and exports. The home UPS segment was under pressure, as the seasonal demand for inverter batteries was severely impacted by the lockdown restrictions in March. EBITDA was Rs 2.4bn (+0.4% YoY) and margin was 15.4% (-82bps QoQ). The negative operating leverage was partially offset by fall in lead prices, a better product mix and cost control measures. APAT grew15% YoY to Rs 1.36bn due to lower tax rate....
1 June 2020 AMRJs 4QFY20 performance beat was driven by a better mix (lower OEM sales). While aftermarket continued with strong growth, endorsing our view of value migration from unorganized, 4Q saw recovery in Telecom. We downgrade rating to Neutral as valuations fairly reflects for recovery and market share gains. Our TP is INR719 (18x Mar22 EPS, 10% discount to 10 year LPA). 4QFY20 revenue/EBITDA/PAT grew 0.9%/0.4%/14.5% YoY to ~INR15.8b/INR2.4b/INR1.4b. FY20 revenues/EBITDA/PAT grew 0.7%/15%/37% YoY to ~INR 68.4b/INR11b/INR6.6b.
Background: Amara Raja Batteries Ltd (ARBL) is the second largest automotive battery manufacturer and the largest supplier of industrial storage batteries in India. JCI, the global leader in lead-acid automotive batteries and advanced batteries for start-stop, hybrid and electric vehicles, provides technical support to ARBL. Company's business model is de-risked as it caters to automotive as well as industrial segments. Sales are...
Amara Raja Batteries Ltd (ARBL) is India's second largest Lead-acid battery manufacturer. Its segment includes automotive and industrial lead acid batteries, with market leadership in Telecom segment. During Q3FY20, ARBL revenue grew by 3.1%YoY, (marginally in-line with our estimate) due to strong replacement market....
Amara Raja's result was slightly better than our expectations. Its top-line was 8.3% above our estimate; however, EBITDA margin was 72 bps below our forecast. Amara Raja's sales increased 3.1% YoY to Rs17 bn and EBITDA increased 12.2% YoY to Rs2.8 bn. EBITDA margin expanded 132bps YoY mainly due to price hike taken by the company in the last one year. Amara Raja's net profit growth of 25.4% YoY to Rs 1,642...
3 February 2020 AMRJs performance was expectedly strong with ~26% YoY PAT growth. More importantly, its volume growth in aftermarket continues to endorse our view of value migration from the unorganized to organized segment. We marginally upgrade our EPS estimate and maintain price of ~INR885 (~20x Mar22E consol EPS). Revenue/EBITDA/PAT grew 3%/12%/26% YoY to INR17.5b/INR2.8b/INR1.6b in 3QFY20. For 9MFY20, revenue/EBITDA/PAT increased ~1%/20%/44% YoY. Revenues were driven by strong volume growth in the auto aftermarket business. However, weakness in the OEM (15-16% decline) and Telecom (13-14% decline) businesses, along with the impact of lower lead prices (2.5-3% YoY decline), resulted in moderate revenue growth. Gross margin of 35.5% (+270bp YoY, -40bp QoQ) exceeded our estimate due to inventory changes and a better mix. However, EBITDA margin expanded at a lower rate of 130bp YoY (-100bp diluted the benefit of gross margin improvement. EBITDA increased ~12% YoY (-3% QoQ) to ~INR2.
Sector: Auto Parts & Equipment /Mid-Cap | Earnings Update 2QFY20 Background: Amara Raja Batteries Ltd (ARBL) is the second largest automotive battery manufacturer and the largest supplier of industrial storage batteries in India. JCI, the global leader in lead-acid automotive batteries and advanced batteries for start-stop, hybrid and electric vehicles, provides technical support to ARBL. Company's business model is de-risked as it caters to automotive as well as industrial segments. Sales are well diversified...
Margin expanded owing to lower lead price Amara Raja Batteries Ltd (ARBL) is India's second largest Lead-acid battery manufacturer. Its segment includes automotive and industrial lead acid batteries, with market leadership in Telecom segment. During Q2FY20, ARBL revenue de-grew by -3.3%YoY, (marginally below our estimate) due to lower auto sales from manufacture's . However EBITDA margin expanded by 370bps to 17.2% on account of sharp decline in Lead price (-3.3%YoY) and better product mix....
9 November 2019 of lead deflation has resulted in revenue decline of 3% YoY to INR17b (v/s est. Volume growth was driven by strong growth in aftermarket, exports and UPS, but diluted by decline in OEMs and telecom. Auto volumes grew 7-8% while Industry volumes grew 6- 7%. Average spot lead prices in 1QFY20 (since impact with 3 months lag) were lower by ~8.5% QoQ and ~18% YoY, which hurt revenue growth. Gross margins improved 500bp YoY (+350bp QoQ) due to lower lead prices and better mix (lower OEM contribution). However, operating deleverage diluted EBITDA margin expansion to ~350bp YoY (+190bp QoQ) at 17.2% (v/s est. This coupled with lower tax boosted adj. PAT growth to ~80% YoY to INR2.2b (v/s est.
Sector: Auto Parts & Equipment /Mid-Cap | Earnings Update 1QFY20 Background: Amara Raja Batteries Ltd (ARBL) is the second largest automotive battery manufacturer and the largest supplier of industrial storage batteries in India. The company supplies auto batteries to OEMs such as Ford, Hyundai, Honda, Mahindra & Mahindra, Maruti Suzuki, Ashok Leyland and Tata motors amongst others. Its Industrial division consists of brands such as PowerStack, Amaron Volt, Amaron Sleek, Amaron brute and Amaron Quanta. Company's business model is de-risked as it caters to automotive as well as industrial segments. The company's products are exported to most...
Amara Raja's Q1FY20 result was broadly in-line of our expectations; however net sales was better than our estimate by 5.3%. Its net sales stood at Rs18.1 bn (+2.0% YoY, 15.8% QoQ) led by higher automotive and export sales. EBITDA was in-line with our forecast at Rs.2.7 bn (+26.8% YoY, +15.3% QoQ); EBITDA margin improved 300bps YoY to 15.4% mainly on price hikes and lower prices of key raw material, lead. Net profit increased 24.7% YoY to Rs 1,409 mn. As Q1FY20 result was in line with our expectation, we broadly maintain our FY20/FY21 forecasts. We continue to value the stock at PE of 18x on our FY21E EPS and maintain...
Amara Raja reported strong results in 1QFY20 in challenging conditions. Net profit jumped 25% YoY to ` 1.4bn, due to sharp margin expansion of 300bps and a low base. We remain positive about the Indian batteries market, as we expect 1) replacement demand to further improve, given healthy primary sales in the past three years, 2) a market share gain from unorganized players, after GST, and 3) an uptick in the nascent e-rickshaws /solar batter. We forecast Revenue/EBITDA/PAT CAGR of 8%/11%/10% over FY19-21E. At CMP, the stock trades at 19/18x for FY20/21E EPS (vs 5...
20 July 2019 to just 2% YoY (INR18.2b v/s our estimate of INR17.4b). 4W battery volumes increased 5% YoY, driven by growth of 10-11% YoY in aftermarket and 22% YoY in exports, partly offset by an 18% YoY decline in OEM volumes. 2W volumes were up 6-7% YoY, driven by 20% YoY growth in aftermarket, despite 25-28% YoY decline OEM volumes. Industrial volumes increased 11% YoY, driven by 25% YoY growth in UPS, despite 8-9% YoY decline in telecom battery volumes. Lead prices were lower by 10-12% YoY. Operating leverage and change in lease accounting (20-25bp benefit) drove 15.1%). Implementation of AS116 (lease accounting) resulted in higher depreciation (by ~INR40m) and interest cost (by ~INR10m). Adj. PAT increased (a) AMRJ recently reacted to the 5- 6% price cut in the 2W replacement market by EXID. (b) Realized lead price was at INR141-143k/ton (v/s INR154k in 4QFY19).
