Tweet
Amara Raja Batteries Ltd. said on Thursday its board approved investing Rs. 530 million to hike its automotive and two-wheeler battery capacity in the wake of rising demand. It plans to increase capacity at its two-wheeler battery unit by 1.8 million units to 5 million.
Capacity at its four-wheeler automotive unit will increase by 800,000 units to 6 million units, the battery maker said in a statement. Car sales in India rose an annual 30.8 per cent in June and they are expected to rise 12-13 per cent in 2010-11, according to the Society of Indian Automobile Manufacturers.
Two-wheeler makers are also riding the economic rebound in India that has boosted consumer spending and bolstered the outlook for companies. "While volume growth in four-wheeler batteries has helped us to gain overall market share, the growth in two wheeler batteries has resulted in peak capacity utilisation, thus encouraging us to look ahead for augmentation of additional capacity at the earliest," the statement added. The expansion will be funded mostly through internal accruals, Amara said in a statement.
Earlier on Thursday the firm reported a lower quarterly net profit of 357.26 million rupees as against Rs. 425.74 million a year ago as pricing challenges in its telecom segment led to margin erosion, it said. However, its quarterly net sales rose around 45 per cent to Rs. 4.46 billion for the period.
"The company expects the pricing and volume pressure to continue, especially in the telecom sector, but is confident of passing through the challenging phase with its support from the customers and quality product," it said in a statement.
Source: Amara Raja to increase automotive battery capacity-WheelsUnplugged Automobile Industry News)
Capacity at its four-wheeler automotive unit will increase by 800,000 units to 6 million units, the battery maker said in a statement. Car sales in India rose an annual 30.8 per cent in June and they are expected to rise 12-13 per cent in 2010-11, according to the Society of Indian Automobile Manufacturers.
Two-wheeler makers are also riding the economic rebound in India that has boosted consumer spending and bolstered the outlook for companies. "While volume growth in four-wheeler batteries has helped us to gain overall market share, the growth in two wheeler batteries has resulted in peak capacity utilisation, thus encouraging us to look ahead for augmentation of additional capacity at the earliest," the statement added. The expansion will be funded mostly through internal accruals, Amara said in a statement.
Earlier on Thursday the firm reported a lower quarterly net profit of 357.26 million rupees as against Rs. 425.74 million a year ago as pricing challenges in its telecom segment led to margin erosion, it said. However, its quarterly net sales rose around 45 per cent to Rs. 4.46 billion for the period.
"The company expects the pricing and volume pressure to continue, especially in the telecom sector, but is confident of passing through the challenging phase with its support from the customers and quality product," it said in a statement.
Source: Amara Raja to increase automotive battery capacity-WheelsUnplugged Automobile Industry News)
Comment