BENGALURU (Reuters) – Indian battery maker Amara Raja Energy & Mobility, formerly named Amara Raja Batteries, posted a bigger-than-expected rise in quarterly profit on Wednesday, helped by strong demand from the automobile sector.
The company’s net profit after tax rose 7.6% to 2.40 billion rupees ($28.9 million) in the three months to Dec. 31, beating analysts’ estimate of 2.19 billion rupees, according to LSEG data.
The automobile industry’s requirement for batteries rose in the quarter as vehicle production increased 21% year-on-year, according to data from industry body Society of Indian Automobile Manufacturers.
Amara Raja has top automakers, including Maruti Suzuki, Tata Motors and Hero MotoCorp, as its clients.
Revenue grew more than 9% to 28.81 billion rupees, boosted by a 12.7% rise in its lead acid batteries and allied products segment which accounts for nearly all its revenue.
The segment includes its industrial business, which benefitted from the expansion of India’s 5G network, as Amara Raja also caters to telecom equipment manufacturers.
The company’s expenses rose about 10%, while raw material costs rose a marginal 2.3%.
Prices of lead, a key input for battery makers, were down sequentially in the quarter.
Rival battery maker Exide Industries missed third-quarter profit estimates last week.
($1 = 83.0423 Indian rupees)
(Reporting by Varun Vyas in Bengaluru; Editing by Sohini Goswami)
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