Amara Raja Energy & Mobility Ltd has reported a robust second-quarter performance for FY2025-26, with net profit rising 17% year-on-year to ₹276 crore. Revenue grew 6.7% to ₹3,467 crore, while the company declared an interim dividend of ₹5.40 per share. Despite margin pressures, the results highlight Amara Raja’s resilience and its ability to capitalize on rising automotive demand.
📊 Financial Highlights
The Q2 results underline Amara Raja’s steady growth trajectory:
- Net Profit: ₹276 crore, up 17% YoY from ₹236 crore.
- Revenue: ₹3,467 crore, up 6.7% YoY from ₹3,251 crore.
- EBITDA: ₹374 crore, down 13.6% YoY, reflecting margin compression.
- EBITDA Margin: 10.8%, compared to 13.3% last year.
- Dividend: Interim dividend of ₹5.40 per share, payable by December 5, 2025.
This mixed performance shows strong top-line growth but highlights challenges in maintaining profitability due to rising input costs and margin pressures.
🚗 Demand Drivers
Amara Raja’s growth was fueled by higher demand from automotive manufacturers, particularly after India’s recent tax reforms that boosted consumer spending on passenger vehicles and two-wheelers.
Key demand drivers include:
- OEM demand surge following tax cuts on small cars and consumer goods.
- Aftermarket strength, with Amaron-branded batteries continuing to dominate replacement markets.
- Export growth, as Amara Raja expands its footprint in international markets.
These factors helped offset margin pressures and ensured profitability growth.
⚙️ Operational Challenges
While revenue and profit rose, EBITDA declined 13.6%, reflecting challenges such as:
- Higher raw material costs, particularly lead prices.
- Margin compression, with EBITDA margin falling to 10.8%.
- Business interruption claims, including a ₹121.79 crore claim related to a fire accident.
Despite these hurdles, Amara Raja’s ability to deliver profit growth demonstrates operational resilience.
🌍 Strategic Outlook
Amara Raja is positioning itself for long-term growth by diversifying into new energy solutions alongside its core lead-acid battery business. The company is investing in:
- Lithium-ion battery technology for EVs and renewable energy storage.
- Sustainability initiatives, including renewable energy investments.
- Global expansion, targeting new markets across Asia and Africa.
These strategic moves aim to future-proof the company as India transitions toward electrification.
🗣️ Leadership Perspective
Management emphasized that the results reflect the company’s ability to adapt to changing market conditions. The interim dividend announcement underscores confidence in future cash flows and shareholder value creation.
✨ Conclusion
Amara Raja’s Q2 FY2025-26 results showcase a 17% profit growth and 6.7% revenue increase, despite margin pressures. The company’s strong demand from OEMs, aftermarket dominance, and strategic diversification into new energy highlight its resilience and forward-looking approach.
As India’s automotive and energy sectors evolve, Amara Raja is well-positioned to leverage opportunities while navigating challenges. The interim dividend further reinforces its commitment to shareholders, making this quarter a significant milestone in its growth journey.
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