AMARA RAJA TO SPEND RS 200 CRORE ON CAPACITY EXPANSION THIS YEAR

G Balachandar, Chennai, July 28, 2008
Financial ChronicleIndustrial and automotive battery maker Amara Raja Batteries, which saw its net sales crossing Rs 1,000 crore mark for the financial year 2008, expects to invest about Rs 200 crore during the current fiscal in three projects to ramp-up its production capacity on the back of increase in demand for batteries.

Buoyed by the growth in demand, driven by telecom and uninterrupted power service (UPS) sectors, in the industrial battery segment, the company plans to boost the production capacity of industrial batteries at its plant near Tirupathi with a fresh investment of Rs 52 crore this fiscal.

In the industrial segment, telecom and UPS sub-segments are the major revenue contributors accounting for about 80 percent of the topline.

With several telecom companies embarking on infrastructure expansion and growth of information technology (IT) and information technology enabled services (ITeS) segments, Amara Raja expects the robust demand in telecom and UPS segment to continue in the coming years as well, K Suresh, chief financial officer, Amara Raja Batteries said.

The company is also expanding the capacity of large VRLA (valve-regulated lead-acid batteries) batteries, meant for telecom applications, to 900 million Ah from 400 million Ah. The project is expected to be completed by September this year.