The automotive battery industry is experiencing a surge in momentum as shares of key players like Exide Industries and Amara Raja Energy and Mobility reach their one-year highs, propelled by the promising prospects of the electric vehicle (EV) sector.
The bullish sentiment stems from expectations that the push for localised EV manufacturing in India will significantly boost demand for batteries, driving growth for manufacturers. Exide Industries, in particular, has garnered attention with its strategic partnerships with Hyundai and KIA, aligning itself with the government’s vision for promoting EV adoption within the country.Exide’s stock witnessed a remarkable 15% surge, while Amara Raja recorded a significant jump of 10.7%, reflecting investor confidence in the sector’s potential. Analysts attribute this positive trend to the substantial capital expenditure (capex) deployed by both companies towards the development of lithium-ion battery segments, with Exide’s strategic partnerships further validating these investments.
The entry of global players like Tesla into the Indian market has further fuelled optimism, as it is anticipated to drive up demand for EVs. Additionally, the government’s Production Linked Incentives (PLI) schemes are providing critical support, creating a conducive environment for battery manufacturers to thrive. Brokerages remain optimistic about Exide Industries’ future, citing its partnerships with global automakers, government backing, and traction in the EV segment as key growth drivers. Morgan Stanley, in particular, highlights Exide’s favourable positioning to capitalise on the government’s initiatives for promoting locally manufactured EVs, coupled with strong ties with auto and industrial customers and early-mover advantages in the market. As India gears up for a significant transition towards electric mobility, the auto battery industry stands poised for substantial growth. With supportive policies, strategic alliances, and a favourable market outlook, companies like Exide Industries and Amara Raja Energy and Mobility are primed to capitalise on the burgeoning EV revolution, signalling a promising future for the sector.
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