Amara Raja Batteries gallops after strong Q1 earnings

Amara Raja Batteries spurted 7.49% to Rs 275.55 at 15:08 IST on BSE after net profit surged 29% to Rs 97.80 crore on 29% growth in net sales excluding other income to Rs 886.80 crore in Q1 June 2013 over Q1 June 2012.

The Q1 result was announced during trading hours today, 14 August 2013.

Meanwhile, the S&P BSE Sensex was up 103.33 points or 0.54% at 19,333.17.

On BSE, 3.47 lakh shares were traded in the counter as against an average daily volume of 40,588 shares in the past one quarter.

The stock surged as much as 10.9% at the day's high of Rs 284.30 so far during the day. The stock hit a low of Rs 257.60 so far during the day. The stock had hit a 52-week low of Rs 156.03 on 14 August 2012. The stock had hit a record high of Rs 328 on 30 January 2013.

The stock had outperformed the market over the past one month till 13 August 2013, sliding 0.74% compared with the Sensex's 3.65% fall. The scrip had, however, underperformed the market in past one quarter, declining 8.41% as against Sensex's 2.35% fall.

The mid-cap company has equity capital of Rs 17.08 crore. Face value per share is Re 1.

Amara Raja Batteries' profit before tax (PBT) surged 25.11% to Rs 140.50 crore in Q1 June 2013 over Q1 June 2012.

The company said it has clocked its highest ever quarterly revenue and PBT in Q1 June 2013.

Commenting on the company's Q1 performance, Mr. Jayadev Galla, Vice Chairman & MD, Amara Raja Batteries said, "We are delighted to report record numbers for the quarter despite a challenging business environment. Both the automotive and industrial battery businesses need supply to continue the growth momentum and gain market share. Our focus is on early completion of capacity expansions which are underway. Our strong belief in capacity lead strategy will help us realize medium and long term objectives."

Mr. Ravi Bhamidipati, Executive Director, Amara Raja Batteries said, "We are very pleased to report a healthy growth in revenue and profit both in industrial and automotive battery businesses. We are confident of growing the business profitably with the help of the product range extensions and continued emphasis on operational efficiency."

Mr. K. Suresh, CFO, Amara Raja Batteries said, "We are closely monitoring the progress of various ongoing projects. We are also observing the currency volatility and its impact on project cost and profitability, to minimize the adverse impact through appropriate actions."

Amara Raja Batteries said that the Automotive Battery business continued to maintain the growth momentum in Four wheeler batteries backed by improved aftermarket sales arising out of strong preference for the company's brands Amaron and Power Zone. The significant volume growth in Two wheeler batteries (Amaron ProbikeRider) had added to the performance of the business unit, it added. The trading in tubular batteries and home UPS under private label program has sustained the momentum during the quarter, despite unfavourable demand conditions, the company said. The company is looking at enhancing the capacity in both the product lines, as announced earlier, to meet future demand and garner more market shares.

The Industrial Battery business registered double digit revenue growth aided by optimal product mix and strong demand for the company's products. The demand from telecom sector continues to be robust and is primarily for replacement, Amara Raja said. Though the growth rate of UPS OEM business has moderated by country's adverse macro-economic conditions, the replacement demand continues to be strong, it added. Amara Raja said that the ongoing expansions, which are expected to commence supplies during the second half of FY 2014, will ably support the growth plans of the industrial battery business.

Amara Raja Batteries is one of the largest manufacturers of lead acid batteries for both industrial and automotive applications in the Indian storage battery industry.

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