Amara Raja approves Rs 2,320 crore capex for pack and LFP cell plants

The approval commits Amara Raja to a 30-month build. The company will finance the facilities through a mix of equity and debt.

The filing does not divide the Rs 2,320 crore between the pack line and the LFP plant. It gives no capacity, customers, technology partner or equipment suppliers for the cell plant.

What the board approved

The pack expansion adds 5 GWh, or 125% above the disclosed 4 GWh base.

Amara Raja's cumulative investment in the advanced-cell subsidiary reached Rs 2,100.01 crore at 30 September 2026.

The 9 GWh figure applies to pack assembly only. The disclosure does not say whether the new cell plant will supply the expanded pack facility.

The quarter behind the caution

Revenue for Q2 FY27 rose 18.5% to Rs 4,108.71 crore. Net profit fell 44.8% to Rs 152.48 crore. EBITDA margin contracted to 8.8% from 10.8% a year earlier. On a standalone basis, revenue from operations was Rs 3,843.25 crore, against Rs 3,368.18 crore a year earlier. Profit after tax was Rs 187.34 crore, against Rs 301.54 crore.

Motilal Oswal kept a Neutral rating and a Rs 740 target on 4 November 2026. It said profit beat its own estimate by 13%, partly helped by price increases taken earlier in the year. The brokerage cut FY27 and FY28 earnings estimates on rising interest costs. It flagged high costs for alloys, sulphuric acid and polypropylene.

The board declared an interim dividend of Rs 4.30 a share. The record date is 6 November 2026. Payment is due on or before 1 December 2026.

Where this sits in the Giga plan

In May 2026 management put FY27 spending at Rs 1,500 crore to Rs 1,700 crore. About Rs 400 crore was for lead-acid, with the rest for new energy. The new approval is larger than that whole-year budget.

Amara Raja still targets Giga 1, the first 2 GWh cylindrical NMC line, to start production in June 2027. The company commissioned a 60 MWh customer qualification plant in July 2026 at a cost of about Rs 500 crore. Cells go to OEMs for validation from August 2026. Amara Raja targets 16 GWh of cell capacity by 2030. Earlier guidance put output at the LFP plant in 2028 or later.

New energy revenue was Rs 209 crore in Q1 FY27. That is about 5% of consolidated revenue, up more than 70% year on year.

Cost gap and the stock

Estimates put Indian cell production at 15% to 20% costlier than Chinese supply. Estimates of the gap vary: a May 2026 report citing Nuvama Research put local manufacturing at around 15% costlier than Chinese imports. Amara Raja's stock is down 0.4% so far in 2026, against an 8.5% gain for Exide. Management has said funding needs will rise as cell capacity scales. The holding company generates an estimated Rs 700 crore to Rs 800 crore a year after tax and dividends. That points to more debt or equity later.

The company is also building a BESS facility costing Rs 250 crore to Rs 300 crore. It is scheduled for commissioning in Q3 FY27. That plant assembles imported LFP cells.

What happens next

Amara Raja has given no commissioning date for either facility.