Amara Raja automotive batteries and OEM growth for FY2012-13
Amara Raja Batteries Limited, a major conglomerate offering an extensive range of products in the form of batteries, power solutions and electronics, have announced increased profits for the financial year ended March 2013. The company’s automotive and industrial battery business posted net profits of INR 286.70 crores as compared to net profits of INR 215.06 crores in year ended 31st March 2012. Income also increased from INR 2,392.44 crore for FY12 to INR 3,007.95 crore for FY13.
These strong results were due to increased demand for company products while customers showed more preference for Amaron and PowerZone batteries which resulted in better market share. Automotive Battery business double digit revenue growth equates to volume increase of 20% in 4 wheeler and 37% in 2 wheeler batteries. Double digit volume growth was reported for the automotive OEM business, despite lowered automobile production in India affected by macro-economic conditions.
Investments to increase automotive 4W battery capacity from 5.60 million units to 8.25 million units per annum and 2W battery capacity from 4.80 million units to 8.40 million units per annum were made through the year. Amaron® and PowerZoneTM inverter batteries have done well through teh year.
Jayadev Galla, Vice Chairman and Managing Director, Amara Raja Batteries said, “We are pleased to report yet another highest ever sales and profit for the Company for the financial year 2012-13, regardless of supply constraints and slowdown in the automobile industry. Both our Industrial and Automotive battery units have reported double digit revenue growth and gained market shares. We remain cautiously optimistic of the Company’s performance in the coming year, against the back drop of continuing uncertainty in macro-economic condition, escalating costs and probable supply constraints. However, our ability to anticipate and perform with distinct approach will help us to sustain the growth momentum in near future and in the long run.”
Ravi Bhamidipati, Executive Director, Amara Raja Batteries Limited said, “We are very pleased to report significant growth in top-line and profits both in industrial and automotive battery businesses. The company is closely watching the cost increases and will try and mitigate the impact through operational efficiencies. We are confident of the growth prospects and hence continue to invest on technology, products, capacities and markets. Recently, we have committed to invest about Rs.7.60 billion on various capacity enhancement projects, looking at the growth opportunities.”
K.Suresh, Chief Financial Officer, said, “The Company continues to enjoy debt free status and has free cash of over Rs. 3.50 billion at the end of the financial year. The year under review saw the Company’s market capitalization touching Rs.50 billion with considerable improvement in PE ratio reflecting growing investor confidence. Various capacity enhancement projects, undertaken during the year, are progressing as per schedule and are well within the approved costs. Continuing debt free status and sound credit rating of the Company will help us to leverage, as and when required, at minimal cost.”