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Amara Raja Batteries Ltd. Stock Analysis

Mid Cap
Evaluated by 6908 users | BSE: 500008 | NSE: AMARAJABAT |
Batteries

Amara Raja Batteries (ARBL), the flagship company of the Amara Raja Group, is a leading manufacturer of automotive batteries under the brands - Amaron and PowerZone, which are distributed through a large pan-India sales & service retail network. The...

1. Right Stock
Very Good
2. Right Price
3. Right Time

Analysis of Financial Track Record

Data adjusted to bonus, split, extra-ordinary income, rights issue and change in financial year end
Financial track record gives insight into the company's performance on key parameters over the past ten years. MoneyWorks4me’s proprietary colour codes make it easy for retail investors to gauge the company’s past performance.
Amara Raja Batteries Ltd. has performed well in majority of the past ten years indicating its past ten year financial track record is very good
Value Creation
Value Creation Index Colour Code Guide
 Mar'11Mar'12Mar'13Mar'14Mar'15Mar'16Mar'17Mar'18Mar'19Mar'20
Return on Capital Employed 21.68%25.14%27.8%27.88%24.9%24.61%19.55%16.19%14.96%18.59%
Value Creation Index 0.540.961.161.160.930.910.520.260.160.44
Growth Parameters
Growth Parameters Colour Code Guide
Net Sales (Rs. Cr.) 1,7592,3642,9593,4374,2114,6185,3176,0596,7936,839
Y-o-Y Gr. Rt.-34.4%25.1%16.2%22.5%9.7%15.2%14%12.1%0.7%
Adjusted EPS (Rs.) 8.6412.0816.7321.1623.4928.3427.5526.6527.7138.11
Y-o-Y Gr. Rt.-39.8%38.5%26.5%11%20.7%-2.8%-3.3%4%37.5%
Book Value per Share (Rs.) 37.8248.2162.0579.7899.5123.88151.82171.98195.28214.03
Adjusted Net Profit 148206286361401484471455473651
Net Op. Cash Flow (Rs. Cr.) 86.12983352793955555533225411,177
Debt to Cash Flow from Ops 1.160.290.260.310.190.130.130.20.110.04
Standalone financials take only the parent company into account while consolidated financials take into account financials of the parent company as well as of all its subsidiaries. In most companies consolidated financials should be used for analysis.
Amara Raja Batteries Ltd. should be analysed on a Standalone basis
CAGR
CAGR Colour Code Guide
  9 yrs 5 yrs 3 yrs 1 yr
Net Sales 16.3%10.2%8.8%0.7%
Adjusted EPS 17.9%10.2%11.4%37.5%
Book Value per Share 21.216.612.19.6
Share Price 27.5% 1.6% 5.9% 24%
Key Financial Parameter
Performance Ratio Colour Code Guide
 Mar'11Mar'12Mar'13Mar'14Mar'15Mar'16Mar'17Mar'18Mar'19Mar'20
Return on Equity (%) 24.8128.0830.3529.8426.225.3819.9816.4615.0918.62
Operating Profit Margin (%) 14.5314.3615.2216.2216.717.8616.0214.614.0516.06
Net Profit Margin (%) 8.398.739.6610.529.5310.488.857.516.979.52
Debt to Equity 0.150.10.080.060.040.040.030.020.020.01
Working Capital Days 1191008885879287106117117
Cash Conversion Cycle 70655353494748596561
Corporate Governance What do we look at?
Corporate Governance
Board Credentials
Promoter's holding
Transparency
Integrity
Entity Percentage Holding
Promoters 28.06%
Institutions 32.86%
Non-Institutions 38.61%
Pledged *0.000.000.000.000.005.935.935.930.000.00
* Pledged shares as % of Promoter's holding (%)

MoneyWorks4Me analysed the past 10-year performance of Amara Raja Batteries Ltd. and arrived at the following conclusion:

Past 10 year's financial track record indicates that Amara Raja Batteries Ltd. is a good quality company. However, for specific investment actions please connect with your investment advisor.

The 5-year analysis of Amara Raja Batteries Ltd.'s performance infers:

Amara Raja Batteries Ltd. earnings have grown by 10.2%, whereas share price has appreciated 1.6% CAGR over the past five years, indicating the company's share price is likely undervalued. However, for specific investment actions please connect with your investment advisor.

We analysed the performance of Amara Raja Batteries Ltd. share prices over the last 10 years. Here is what we found out:

Amara Raja Batteries Ltd. share price has appreciated 26.2% annually over the past ten years.

Amara Raja Batteries (ARBL), the flagship company of the Amara Raja Group, is a leading manufacturer of automotive batteries under the brands - Amaron and PowerZone, which are distributed through a large pan-India sales & service retail network. The company's Industrial and Automotive batteries are exported to several countries across the globe. It is the first company to manufacture Valve Regulated Lead-Acid (VRLA) batteries in India. They are

Amara Raja Batteries (ARBL), the flagship company of the Amara Raja Group, is a leading manufacturer of automotive batteries under the brands - Amaron and PowerZone, which are distributed through a large pan-India sales & service retail network. The company's Industrial and Automotive batteries are exported to several countries across the globe. It is the first company to manufacture Valve Regulated Lead-Acid (VRLA) batteries in India. They are engineered to provide the performance reliability and consistency over the life of the product and they offer a long battery life with minimal maintenance. In India, the company is the preferred supplier to major telecom service providers, Telecom equipment manufacturers, UPS sector (OEM & Replacement), Indian Railways and to Power, Oil & Gas among other industry segments. 

The company’s manufacturing facilities are equipped with state-of-the-art machines and technology. Each plant is designed to improve shop floor efficiencies by adopting globally recognized concepts such as Lean Six Sigma, 5S and Quality Circle projects. The manufacturing facilities have imbibed low-cost automation to reduce operator fatigue which helps in improving product quality and person productivity. Its World-Class integrated manufacturing facilities are constantly evolving and are ever ready to adopt the latest technological advancements. Its in-house R & D centre, which is recognized by Government of India, ensures constant innovation and best in class products.

Business area of the company

The company is the technology leader and is one of the largest manufacturers of lead-acid batteries for both industrial and automotive applications in the Indian storage battery industry. Amara Raja Automotive Batteries offers a wide range of battery solutions in Passenger Vehicles, Three Wheelers, Two Wheelers, Commercial Vehicles, Farm Vehicles, and Home UPS/Inverters. Besides, Amara Raja Industrial Batteries offers a broad range of battery solutions in segments like UPS, Telecom, Railways, Defence and Motive.

Products

  • PowerStack
  • Amaron Sleek 
  • Amaron Volt 
  • Genpro 
  • Amaron Quanta
  • Amaron Quanta-HWS 
  • Amaron Quanta -HUPS
  • Amaron Brute
  • Amaron Solar
  • Amaron Quanta S-XEL

Awards and Accolades

  • 2013: Received the Gold Award for support in the SME category in the event organized by Indus Towers.
  • 2014: Presented with the Silver Award for support in the category 'Infra - Equipment’ in event organized by Indus Towers.
  • 2016: Bagged recognition for being 'Telecom Infra Leader' in the Power Solutions Category for the year 2016 at the 24th Annual CyberMedia ICT Awards.
  • 2016: Received the Gold Award for support in the category 'Infra-Equipment' in event organized by Indus Towers.
  • 2017: Received an award from Tata Motors and this award is in recognition for its excellence in the field of QCDM parameters (Excellence in Quality, Delivery, and Relationship Building).
  • 2017: Bagged 'India's Most Promising Company of The Year 2016-2017' award during the 12th CNBC TV18 India Business Leader Awards that was held in Delhi.
  • 2017: Received awards for 'Consistent High-Quality Performance' and 'Design & Development' from Maruti Suzuki India.
  • 2017: Received Overall Performance Award – Bosch.
  • 2017: Amara Raja Group Small Battery Division has won the First Runner Award in Eleventh CII Six Sigma National Conference and Competition under the 'Manufacturing Industry (Discrete and Assembly Line)' category.
  • 2018: Received first prize in AP Green awards 2017 under Industries (Private) category from A.P. Greening and Beautification Corporation, Government of Andhra Pradesh.
  • 2018: Presented with Gold Award for support in the category 'Infra Equipment- Supply in the event organized by Indus Towers.
  • 2018: Received an award for 'High-Quality Performance' from Bajaj Auto.
  • 2018: Received an award for 'Best Vendor Rating and System Audit' from Maruti Suzuki India.
  • 2018: Secured second place in 'Construction Safety' in a competition held during the quarterly award function in Maharashtra Circle.

History and Milestones

  • 1995: Incorporation of the company.
  • 1989: Inks technology agreement with GNB Batteries Inc.
  • 1990: Introduced VRLA technology in India.
  • 1991: Goes public.
  • 1991: Launched VRLA batteries for telecom application.
  • 1992: Commenced production of VRLA batteries.
  • 1993: Launched batteries for Indian Railways.
  • 1995: First export shipment of Industrial Batteries by company.
  • 1996: Launched VRLA batteries in Indian Railways for Rolling Stack Application.
  • 1997: Received ISO certification.
  • 1997: Diversified into automotive batteries and signed JV with Johnson Controls Inc.
  • 1998: Received QS-9000 certification.
  • 1998: Supply of first batch of automotive batteries to Ford India.
  • 2000: Launched Brand AMARON Automotive batteries.
  • 2001: Received ISO 14001 certification.
  • 2001: Corporate logo launched.
  • 2001: Inauguration of Automotive battery plant.
  • 2002: Industrial Batteries division (IBD) of company launched Quanta Branded UPS Batteries.
  • 2002: Automotive Batteries division (ABD) of company launched Amaron Hi Way and Amaron Harvest batteries.
  • 2004: Automotive Batteries division (ABD) of company launched Amaron PRO, Amaron GO, Amaron FRESH and Amaron SHIELD batteries.
  • 2007: Launched Brand Powerzone Automotive Batteries.
  • 2007: Inaugurated 2 Wheeler battery plant.
  • 2008: Launched Amaron Probike Rider, the first AGM batteries for two wheelers.
  • 2010: Unveiled new Amaron logo.
  • 2010: Launched Amaron Sleek and Amaron Volt brands for Industrial applications.
  • 2012: QRS series introduced for Telecom to aid efforts in reduction of diesel consumption.
  • 2012: Launched Amaron Current HUPS Tubular Batteries.
  • 2014: Inaugurated world’s largest integrated Medium Valve Regulated Lead Acid (MVRLA) battery plant at ARGC, Nunegundlapalli, Chittoor, Andhra Pradesh, India.
  • 2016: Inaugurated Tubular battery plant.
  • 2017: Launch of Amaron Brute brand for Motive Power by Industrial Batteries Division.
  • 2017: Inaugurated India’s largest and most advanced two wheeler battery plant at Amara Raja Growth Corridor (ARGC).
  • 2018: Incorporation of wholly owned subsidiary in Sharjah Airport International Free Zone (SAIF Zone).
Puchho Befikar
SEBI Registered: Investment Adviser - INA000013323

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