ICICI Direct has given Reduce recommendation for Amara Raja Batteries with a target price of Rs. 475 in its research report issued on Aug 24, 2022
ICICI Direct’s research report on Amara Raja Batteries
Amara Raja Batteries (ARBL) is a part of the duopolistic organised Indian lead acid battery market with a strong presence across automotive (OEM, aftermarket) and industrial battery space (UPS, telecom, solar, etc). Geographical mix as of FY22: domestic ~87%, export ~13% • Battery capacity as of FY22: 1.62 crore units for 4-W, 2.91 crore units for 2- W, 2 bn AH for industrial battery; cumulative across eight plants in India.
We downgrade from HOLD to REDUCE rating given future growth challenge posed by EV transition and delayed commitment towards Li-On space. Revising our estimates we now value ARBL at a revised TP of Rs 475 i.e. 13x P/E on FY24E EPS of Rs 36.6/share (earlier TP Rs 650.
At 17:30 Amara Raja Batteries was quoting at Rs 517.90, up Rs 6.35, or 1.24 percent.
It has touched an intraday high of Rs 523.70 and an intraday low of Rs 513.55.
It was trading with volumes of 51,619 shares, compared to its thirty day average of 34,078 shares, an increase of 51.47 percent.
In the previous trading session, the share closed up 0.21 percent or Rs 1.05 at Rs 511.55.
The share touched its 52-week high Rs 781.00 and 52-week low Rs 438.15 on 11 October, 2021 and 20 June, 2022, respectively.
Currently, it is trading 33.69 percent below its 52-week high and 18.2 percent above its 52-week low.
Market capitalisation stands at Rs 8,846.38 crore.