Amara Raja Batteries sees telecom impact on Q2 sales

Amara Raja Batteries reported a modest improvement in its results for the September quarter, with operating profit edging above last year’s level by a whisker.

Growth would have been faster, if it hadn’t been for the disruption in the telecom market, the company said.

The company’s revenue increased compared to the same quarter last year, but fell when compared to the previous three months.

The company had revenue of Rs 1,428 cr for the three months ended September, down from 1,497 cr in the June quarter, but higher than the Rs 1,333 cr posted in the same quarter last year.

Profit before tax was at 191 cr, versus 194 cr last year, but significantly higher than the Rs 151 cr posted in the previous three months (June quarter).

Net profit fell 6.67% to Rs 127.22 crore.

The company said it was hit by higher prices for Lead, the core component in batteris.

Prices for the metal continue to see inflationary trends with prices escalating as much as 25% over the last 12 months, it said.

“We have been able to offset the price pressure by a mix of cost management strategies and pricing actions,” it said.

“The automotive and industrial businesses have been built on strong foundations and are capable to respond to the challenges presented by Commodity price pressure and Capitalize on opportunities presented by the dynamic changes in the market place,” said Jayadev Galla, Vice Chairman & Managing Director, Amara Raja Batteries.

“We are excited about the new opportunities in EV and Energy storage application and investments in newer technologies are on the anvil to address the emerging and future trends.”

The company said capacity utilization across of most of product lines have been very healthy during the quarter.


The company also gets a substantial part of its sales from telecom and other industrial sectors.

This was hit due to the ongoing consolidation in the industry, it said.

“The Industrial battery business recorded significant growth in volumes over the previous year in all segments except Telecom which continues to witness disruptive changes and consolidation moves. Consequently demand for batteries in the Telecom sector was lower in the quarter,” it said.

Not such, troubles, however befell the automotive sector, which continued to grow fast, Amaron said.

“Demand for the Amaron and PowerZone brands was robust during the quarter in both four wheeler and two wheeler segments helping further consolidation of market share.

“Tubular battery sales to HUPS segment have sustained growth momentum driving significant increase in volume. This has helped the Company to record very healthy capacity utilization during the quarter in all product categories acroSS automotive battery business,” it added.