Amara Raja Energy & Mobility (500008) Q4 97/98 earnings summary

Executive summary

• FY98 delivered strong growth, with sales up 43% and orders booked up 34% YoY; expansion and a Johnson Controls alliance positioned the business for entry into automotive batteries.

• Productivity gains, cost control and customer focus supported growth amid stiff competition and broader consolidation in the battery industry.

Financial highlights

• Sales reached ₹144.38 crore vs ₹101.01 crore in FY97; profit before tax was ₹40.52 crore vs ₹21.04 crore, and profit after tax was ₹31.32 crore vs ₹15.24 crore.

• Other income rose to ₹1.50 crore from ₹0.72 crore, including ₹1.25 crore of interest received; interest expense fell to ₹1.40 crore from ₹2.10 crore.

• Recommended dividend increased to ₹4.50 per equity share, or 45%, from 30%; dividend and tax would absorb ₹4.02 crore.

Outlook and guidance

• Production capacity expanded from 1,320 lakh Ah to 1,820 lakh Ah; management was exploring a 5 MW captive power plant or a power-purchase agreement with APGPCL.

• New products developed through in-house R&D were under field performance; future R&D plans included traction batteries, SLI technology transfer and new raw-material sources.

• The Johnson Controls alliance was intended to modernize facilities, broaden products and markets, and develop automotive battery operations.