Amara Raja Energy & Mobility Ltd Q4 FY25 Earnings Analysis

Future growth expectations for Amara Raja Energy & Mobility Limited as per the transcript are: - Lead Acid Battery Business: - Four-wheeler segment expected to grow around 8-9% in volume. - Two-wheeler segment expected to grow around 11-13% in volume. - UPS segment (industrial side) expected to grow 6-7%. - Export market projected to grow 13-14%. - Overall revenue momentum on lead acid battery side expected at approximately 11-12% growth going forward. - New Energy Business: - Lithium-ion pack and charger business grew to about Rs. 500 crores last year; expecting 10% growth this year. - Cell manufacturing plant to start in FY26 (Q1), expected to contribute Rs. 1,100 - 1,200 crores annualized revenue once operational. - Manufacturing capacity ramp-up may increase trading revenue by at least 20%. - Longer-term, lithium-ion business expected to take 2-3 years to stabilize and reach EBITDA breakeven. - Telecom segment revenue expected to decline on lead acid but partly offset by lithium conversion. Overall, the company expects continued double-digit revenue growth driven by automotive, industrial, export, and new energy segments.

- Lead acid battery business expects ~11-12% revenue growth supported by 8-9% growth in 4W segment, 11-13% growth in 2W segment, ~6-7% in UPS, and 13-14% in exports next year. - Lithium-ion (NMC) plant to start commercial production by end CY26 or early 2027, reaching breakeven and positive EBITDA only after 2-3 years due to ramp-up. - New energy business pack segment expected to grow at double digits; revenue was ~Rs. 500 crores last year with 10% YoY expected growth this year. - Tubular battery manufacture plant to start in Q1 FY26, anticipated to add 20% revenue but initial volumes may be limited. - Overall CAPEX for FY26 expected to be around Rs. 1000 crores with focus on both lead-acid and new energy capacity expansions. - Earnings growth tempered initially by ramp-up costs and raw material price pressures but expected to stabilize with scale and localization.

- Current year CAPEX: Around Rs. 400 crores (excluding tubular plant restatement), plus Rs. 200-300 crores for new energy business. - Next year CAPEX: Estimated Rs. 300-400 crores for lead acid business and Rs. 500-600 crores for new energy business, totaling around Rs. 1000 crores. - Additional investment approved: Rs. 200 crore for phase two of ARCSPL (recycling battery venture) depending on project progress. - Amara Raja Power Systems received unsecured loan approval of Rs. 50 crores for charger manufacturing business. - CAPEX includes capacity additions in 4-wheeler segment and automation/digitalization in lead acid battery factories. - Lithium-ion NMC plant expected commercialization by FY27-end/early FY28, with LFP plant licensing about 12 months afterward. - Investments are timed carefully due to high capital intensity and market uncertainties to avoid financial burden.

- The company mentioned an increase in investment in ARCSPL (recycling battery venture) with board approval for an additional Rs. 200 crore depending on project progress. - For Amara Raja Power Systems (charger manufacturing), there is an unsecured loan approval of about Rs. 50 crore planned. - There is no equity investment proposed at this point in time. - Future funding could depend on project requirements but no immediate equity fundraising is suggested. - Debt funding through unsecured loans is planned for some business segments. - Overall, current focus is on calibrated CAPEX and investments rather than fresh equity issuance.

- No specific current or expected orderbook value was disclosed. - The company mentioned existing agreements with OEMs for NMC cells, including a prior announcement for 21,700 cells with a couple of OEMs. - Discussions are ongoing with several other OEMs, particularly for two-wheeler and three-wheeler applications. - Exact details or numbers about new orders or pending orders in the lithium-ion cell business were not shared. - The company is cautiously optimistic about ramping up revenue in the lithium-ion business with localized chargers and DC fast chargers contributing to growth. - Amara Raja expects growth in the new energy business but did not specify hard figures for the orderbook or pending orders during the call.