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AMARA RAJA BATTERIES
Key takeaways
The company has a 45% market share in the telecom segment, 32% market share in the
commercial UPS segment, 28% market share in the organized replacement 4-wheeler
segment, 25% market share in the organized replacement 2-wheeler segment. 40% of
company’s revenues come from the industrial segment and rest 60% come from the
automotive segment.
The company indicated that it supplies to all 4-wheeler OEMs and has a 25% market
share in the 4-wheeler OEM segment. However, it does not supply to any 2-wheeler OEM
currently. The company expects to start supplying to the 2-wheeler OEMs over the next 8-
10 months. Despite no tie-ups with 2-wheeler OEMs, the company has been able to
increase its market share in the organized 2-wheeler replacement battery segment from
5% to 25% over the past 3 years.
The company expects the automotive replacement segment to grow at 12-15% CAGR
over the next 5 years and it has not seen any slowdown in replacement battery volumes.
The company has increased its market share in the 4 wheeler replacement battery
segment by 5% over the last 2-3 years partly at the expense of Exide and partly of other
players.
The company expects the 2-wheeler organized replacement market to grow at a rapid
pace due to the shift towards self-start which requires powerful and reliable batteries.
In the industrial segment, telecom battery contributes 50% of industrial revenues while
commercial UPS forms 35% of industrial revenues. Rest 15% of industrial revenues
comprise exports, railways and power distribution/transmission sector. The company is
not present in the inverter battery segment.
In the telecom battery segment, the company indicated demand is subdued due to no
new tower additions and delay in replacement of telecom batteries. However, the
company expects demand to grow at 7-8% yoy in FY2012E in the telecom segment
driven by replacement of telecom batteries. The company expects telecom battery prices
to also start rising as 3G penetration increases over the next 5 years as 3G network would
require more powerful batteries.
In the UPS segment, Exide, Amara Raja and Chinese imports are the 3 major players
having almost equal market share of 32%. While Amara Raja has a dominant market
share in the commercial UPS segment, Exide dominates in the home UPS segment.
Operating margins in this segment are lower than automotive replacement due to
significant competition by imported batteries. The company expects this segment to grow
at 12-14% CAGR over the next few years.
The company’s capacity will increase to 5.6 mn in 4-wheeler batteries and to 5 mn in the
2-wheeler battery segment by end of CY2011. It has a capacity of 900 mn ampere hours
in the industrial segment.
India Equity Research Reports, IPO and Stock News
Visit http://indiaer.blogspot.com/ for complete details �� ��
AMARA RAJA BATTERIES
Key takeaways
The company has a 45% market share in the telecom segment, 32% market share in the
commercial UPS segment, 28% market share in the organized replacement 4-wheeler
segment, 25% market share in the organized replacement 2-wheeler segment. 40% of
company’s revenues come from the industrial segment and rest 60% come from the
automotive segment.
The company indicated that it supplies to all 4-wheeler OEMs and has a 25% market
share in the 4-wheeler OEM segment. However, it does not supply to any 2-wheeler OEM
currently. The company expects to start supplying to the 2-wheeler OEMs over the next 8-
10 months. Despite no tie-ups with 2-wheeler OEMs, the company has been able to
increase its market share in the organized 2-wheeler replacement battery segment from
5% to 25% over the past 3 years.
The company expects the automotive replacement segment to grow at 12-15% CAGR
over the next 5 years and it has not seen any slowdown in replacement battery volumes.
The company has increased its market share in the 4 wheeler replacement battery
segment by 5% over the last 2-3 years partly at the expense of Exide and partly of other
players.
The company expects the 2-wheeler organized replacement market to grow at a rapid
pace due to the shift towards self-start which requires powerful and reliable batteries.
In the industrial segment, telecom battery contributes 50% of industrial revenues while
commercial UPS forms 35% of industrial revenues. Rest 15% of industrial revenues
comprise exports, railways and power distribution/transmission sector. The company is
not present in the inverter battery segment.
In the telecom battery segment, the company indicated demand is subdued due to no
new tower additions and delay in replacement of telecom batteries. However, the
company expects demand to grow at 7-8% yoy in FY2012E in the telecom segment
driven by replacement of telecom batteries. The company expects telecom battery prices
to also start rising as 3G penetration increases over the next 5 years as 3G network would
require more powerful batteries.
In the UPS segment, Exide, Amara Raja and Chinese imports are the 3 major players
having almost equal market share of 32%. While Amara Raja has a dominant market
share in the commercial UPS segment, Exide dominates in the home UPS segment.
Operating margins in this segment are lower than automotive replacement due to
significant competition by imported batteries. The company expects this segment to grow
at 12-14% CAGR over the next few years.
The company’s capacity will increase to 5.6 mn in 4-wheeler batteries and to 5 mn in the
2-wheeler battery segment by end of CY2011. It has a capacity of 900 mn ampere hours
in the industrial segment.
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