Economy

Exide in consolidation, charged up on capacity addition

V Rishi Kumar Hyderabad | Updated on February 19, 2018 Published on February 19, 2018

Gautam Chatterjee, CEO and MD, Exide Industries

Battery-maker plans to raisecapex, says CEO Gautam Chatterjee

Exide Industries, the largest battery maker in the country, is on a consolidation and capacity-addition mode, with all of its manufacturing plants functioning at near 100 per cent utilisation.

The company, which commands a market share in excess of 45 per cent, expects a strong double-digit growth. The company has deployed about ₹800 crore towards capital expenditure this fiscal to augment capacity as it looks towards a strong growth outlook.

Strong quarters

Gautam Chatterjee, Managing Director and Chief Executive Officer, Exide Industries, said: “There has been strong growth momentum thus far this fiscal, and we expect to repeat this during the current quarter [fourth quarter of 2017-18] and next year.”

The first quarter was relatively slow when compared to the second and third quarters this fiscal. “While in Q1 we grew by about 11 per cent, the growth was up at 24 per cent in Q2, and this was up at 33 per cent during the third quarter against the industry growth of 8-10 per cent,” he told BusinessLine.

“The first quarter was relatively slow due to hiccups of post demonetisation and some other external issues, including GST. But thereafter, the business has been robust,” he said.

Battery owners helpline

Chatterjee, who was in Hyderabad to launch Battery Doctors, an-app-cum offline one-stop helpline for battery owners, said the sector is poised for strong growth, having put behind some of the concerns.

“We are chock-a-block, functioning at full capacity and invested significantly this fiscal to augment capacity. When the board meets, we may finalise higher capex and consider further capacity addition. This is necessary given the market opportunity. During the year, we will commission additional facility through acquisition in Gujarat,” he said.

“Our growth has been quite positive across different segments, in auto original equipment manufacturers [OEMs], industrial segments, UPS and telecom. We have been able to sustain growth and keep up share. In the OEM market for 4-wheelers, our share is 60 per cent and for two-wheelers it is 70 per cent,” he said.

“Exide makes smallest two-wheeler batteries going up specialised batteries used in submarines, which are priced at ₹20 crore. We expect to consolidate on these strengths,” he said

“The automotive sector accounts for a total business in the country at about ₹16,000 crore and the industrial segment about ₹4,000 crore. Of the total market of ₹20,000 crore, we account for about ₹9,000-9,500 crore,” he said.

“We have a capacity to manufacture 16 million four-wheeler batteries and 28 two-wheelers batteries across seven plants. They are functioning at 100 per cent capacity,” he said

On growing input costs, he said: “There is concern about lead prices which are going up. The company is focussing on cost control and technology upgradation to improve the bottom line,” he said.

Published on February 19, 2018
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