EXIDEIND - Exide Inds.

📊 NSE: EXIDEIND 🏢 Auto Ancillaries 📅 Last Updated: 12/13/2025 22:01

💰 Financial Performance

Revenue Growth by Segment

The company recorded a modest 1.3% overall revenue growth in H1 FY26. Within this, 88% of the business (comprising aftermarket, automotive, solar, and IUPS) grew by approximately 7%. Conversely, the remaining 12% of the business, which includes exports, the e-rickshaw (last mile) segment, and telecom, witnessed a revenue decline due to weaker demand.

Geographic Revenue Split

Not specifically disclosed in available documents, though the company maintains a pan-India distribution network and exports contribute to a portion of the 12% declining segment.

Profitability Margins

Gross and operating margins were impacted by high input costs and production cuts. Management noted that historical margins of 13.5% to 14.5% occurred when lead prices were 20-30% lower and the USD/INR was at 80. Currently, with the exchange rate at 90 and high lead LME, the company is maintaining double-digit EBITDA through cost efficiency.

EBITDA Margin

Management expects to demonstrate EBITDA margins of 12% to 13% in coming quarters. Q1 FY26 margins were above 12%, but Q2 FY26 was impacted by production cuts in August and September 2025 following GST rate changes.

Capital Expenditure

Exide has significant capex plans of INR 3,500-4,000 crore for FY2025-FY2026. Specifically, INR 580 crore was invested in the lithium-ion project in H1 FY26, with an additional INR 65 crore in October 2025. The total equity investment in the subsidiary Exide Energy Solutions Limited (EESL) reached INR 4,022.23 crore by November 25, 2025.

Credit Rating & Borrowing

The company maintains a top-tier credit profile with [ICRA]AAA (Stable) for long-term fund-based and non-fund based limits (totaling INR 2,000 crore) and [ICRA]A1+ for its INR 50 crore Commercial Paper program. Financial closure for debt-funded portions of the Li-ion capex has been achieved.

⚙️ Operational Drivers

Raw Materials

Lead (LME-linked) is the primary raw material, representing a significant portion of the cost structure. Other inputs include materials for solar combo packs and lithium-ion cell components.

Import Sources

Not specifically disclosed, though the company is highly sensitive to the USD/INR exchange rate (currently at 90) and global Lead LME prices.

Capacity Expansion

The Lithium-ion cell manufacturing project (Phase 1) has a total cost of INR 5,200 crore. Line 1 of 4 is nearing commissioning, representing an initial 25% capacity utilization. Expansion to Line 3 within the same fiscal year could push utilization toward 30% or higher.

Raw Material Costs

Input material costs are under continuous pressure. Lead LME prices are currently 20-30% higher than in previous high-margin periods. The company manages this through cost excellence projects and manufacturing technology investments.

Manufacturing Efficiency

The company relies on 'cost excellence' projects and advanced manufacturing technology to maintain double-digit EBITDA despite a 12.5% currency depreciation (INR 80 to INR 90 per USD) and high raw material costs.

Logistics & Distribution

The company operates a pan-India distribution network to support its dominant market position in the replacement segment.

📈 Strategic Growth

Expected Growth Rate

Growth Strategy

Growth is driven by the 'GST 2.0' reform, which reduced battery tax from 28% to 18%, expected to spur long-term demand. Strategically, the company is pivoting toward lithium-ion cell manufacturing via its EESL subsidiary to capture the EV transition, while maintaining its 7% growth in core lead-acid segments like automotive aftermarket, solar, and IUPS.

Products & Services

Lead-acid batteries for automotive (2-wheelers, 4-wheelers), industrial use (power, railways, motive power), solar combo packs, IUPS, and upcoming Lithium-ion cells.

Brand Portfolio

Exide

New Products/Services

Lithium-ion cells (manufacturing nearing completion) and solar combo packs (benefiting from GST reduction from 12% to 5%).

Market Expansion

Focusing on the lithium-ion market through EESL and strengthening the B2C trade business under new executive leadership.

Market Share & Ranking

Exide holds a dominant market position in lead-acid batteries and a healthy market share in the replacement (aftermarket) segment.

Strategic Alliances

Not specifically named in the documents, though EESL is a 100% wholly-owned subsidiary.

🌍 External Factors

Industry Trends

The industry is shifting toward green energy and EVs. Exide is positioning itself as an early mover in lithium-ion cell manufacturing in India with a total project cost of INR 5,200 crore to address this disruption.

Competitive Landscape

The company faces competition in the lead-acid space but maintains a 'dominant' position. The transition to Li-ion is a key competitive frontier.

Competitive Moat

Exide's moat is built on a dominant market share in the lead-acid replacement segment, a pan-India distribution network, and strong brand recall. Its early mover advantage in Li-ion cells provides a sustainable path for the EV transition.

Macro Economic Sensitivity

Highly sensitive to GST policy changes and automotive industry production trends. The 52% growth in October 2-wheeler retail sales suggests a strong macro recovery in consumer demand.

Consumer Behavior

Consumers are increasingly adopting solar solutions (supported by GST cuts to 5%) and EVs, prompting the company's shift toward lithium-ion technology.

Geopolitical Risks

Global lead price volatility and export demand weakness (contributing to a decline in 12% of the business) represent key external risks.

⚖️ Regulatory & Governance

Industry Regulations

Operations are governed by GST 2.0 reforms and auto industry standards. The company is fully aligned with government goals to reduce the tax burden on end consumers.