Amara Raja Energy & Mobility Limited (ARE&M) has reported a consolidated revenue of INR 3,467 crores for the second quarter, marking a 6.5% year-over-year growth. The company's performance was primarily driven by robust demand from Original Equipment Manufacturers (OEMs) in the automotive sector.

Lead Acid Business Remains Strong

The lead acid business, which contributes 95% of the company's revenue, grew by 5% year-over-year to INR 3,297 crores. This growth was largely attributed to a significant 30% increase in OEM volumes across both 4-wheeler and 2-wheeler segments. However, aftermarket volumes remained stable due to procurement delays following GST rate revisions.

New Energy Business Shows Promise

ARE&M's New Energy business demonstrated impressive growth, delivering INR 170 crores in revenue, a more than 50% increase compared to the previous year. This growth was supported by increased demand for telecom packs and chargers. The company supplied 150 megawatts in telecom volumes and commenced production of 3-wheeler packs with LFP cells.

Financial Performance

The company's stand-alone operating margins stood at 12%, impacted by warranty expense provisions and Extended Producer Responsibility (EPR) liability provisions totaling INR 35 crores. Excluding these provisions and the impact of lithium telecom batteries, the adjusted operating margin would have been around 12.4%.

Investment in Lithium Subsidiary

ARE&M invested INR 350 crores in Amara Raja Advanced Cell Technologies during the quarter, bringing the total investment in its lithium subsidiary to INR 1,200 crores. This move aligns with the company's strategy to expand its presence in the New Energy sector.

Segment-wise Performance

Future Outlook

The company has outlined a capital expenditure plan of INR 1,400-1,500 crores for the full year, with a major allocation towards the New Energy business. ARE&M aims to increase its New Energy business contribution to 5% of overall revenue by the end of the current fiscal year and potentially 7-8% by FY'27.

Y. Delli Babu, Chief Financial Officer of Amara Raja Energy & Mobility Limited, commented on the results, stating, "We expect the Lead Acid Battery revenue to grow anywhere between 8% to 10% in the next year as well. Our aspiration is to move to a 13% EBITDA margin on a run rate basis and eventually return to our original 14% margin over time."

The company's focus on both traditional lead acid batteries and new energy solutions positions it well to capitalize on the evolving energy storage market in India and internationally.

Six companies have recently announced dividends, setting November 13 as the record date for dividend eligibility. This announcement impacts investors looking to qualify for these dividend payments, with November 12 being the last day to purchase shares to be eligible.

Dividend Details

Key Points for Investors

• Last Trading Day: Investors must own shares by November 12 to receive the dividend payments, due to India's T+1 settlement cycle.

• Tax Implications: Dividend income exceeding Rs 5,000 annually is subject to 10% TDS (Tax Deducted at Source) for resident individuals.

Company Highlights

• Great Eastern Shipping leads with the highest per-share dividend at Rs 7.20, classified as an interim dividend.
• Kriti Nutrients has declared a special dividend of Rs 3 per share.
• Sasken Technologies offers the second-highest dividend at Rs 12 per share.

Investors should note that these dividend announcements provide an opportunity for income from their investments. However, it's crucial to consider the ex-dividend date effect on share prices and the tax implications before making investment decisions based solely on dividend yields.

As always, it's advisable for investors to conduct thorough research and consider their overall investment strategy and financial goals when making decisions about dividend-paying stocks.