Indian battery maker Amara Raja's Q2 profit rises on steady automotive demand

Exide Industries

04/11/2024 13:31

Nov 4(Reuters) - Indian battery maker Amara Raja Energy
& Mobility  AMAR.NS  reported a 6.3% rise in second-quarter
profit on Monday, aided by continued demand from automotive
manufacturers.
        The company's net profit rose to 2.41 billion rupees
($28.7 million) for the quarter ended Sept. 30, from 2.26
billion rupees a year earlier.  
  
        However, this is its slowest quarterly profit growth in
a year as car manufactures moderated dispatches to dealers to
help reduce high inventory during the quarter. 
  
        This also resulted in rival Exide Industries  EXID.NS 
reporting a 
    smaller-than-expected profit
     earlier in the day. 
  
        India's total vehicle production increased 9% in the
September quarter, but slowed down sequentially from 16.1% in
the first quarter, according to Society of Indian Automobile
Manufacturers (SIAM), an industry body. 
  
    Amara Raja, which derives almost three-fourths of its
revenue from its automotive battery business, counts top
automakers including Bajaj Auto  BAJA.NS , Hero MotoCorp
 HROM.NS  and Maruti Suzuki  MRTI.NS  among its clients.
        While Amara Raja's revenue from operations increased
11.6% to 31.36 billion rupees during the July-September period,
this is its slowest growth since the December quarter.
  
     Analysts say that the growth was driven by the company's
aftermarket division - which includes replacing original
equipment batteries - and a rise in its two-wheeler battery
division.
     Amara Raja's shares closed 2.2% lower ahead of its results.
They have risen 68.4% so far this year, while those of Exide
Industries  EXID.NS  jumped 40%.
    

($1 = 84.0840 Indian rupees)

 (Reporting by Meenakshi Maidas in Bengaluru; Editing by Sonia
Cheema)
 ((Meenakshi.Maidas@thomsonreuters.com; +91 8921483410;))