- 24 Apr 2024
- ICICI Securities
COMPANY SUBMITS BID ACC-PLI SCHEME FOR LI-ON BATTERY STORAGE
ARE&M - 1019 Change: 23.60 (2.37 %)News: As per government notification, Ministry of Heavy Industries (MHI) has received bids from seven bidders under global tender for the re-bidding of Production Linked Incentives (PLI) for 10 GWh Advanced Chemistry Cell (ACC) manufacturing. The list of bidders are: ACME Cleantech Solutions Pvt. Ltd, Amara Raja Advanced Cell Technologies Pvt. Ltd, Anvi Power Industries Pvt. Ltd, JSW Neo Energy Limited, Reliance Industries Limited, Lucas TVS Limited, and Waaree Energies Limited for a cumulative capacity of 70 GWh.
Views: Amara Raja Energy & Mobility is a leading player in organised Indian lead acid battery market. In the new energy space, the company via its WoS i,e, Amara Raja Advanced Cell Technologies Pvt. Ltd, has expressed commitment for setting up of Li-Ion Battery Gigafactory. The said facility is expected to have cell manufacturing capacity of up-to 16GwH & assembly capacity of up to 5 GWh with overall investment pegged at ~₹9,500 crores over next 10 years. The stock was substantially up in the trade yesterday post this news of it applying for the PLI scheme. In our view, if company wins bid in the said ACC-PLI scheme, this shall substantially boost its profitability and return ratios profile at the said venture with management guiding for subpar matrix vs. its existing business. We await further developments in this space and expect stock to consolidate at present levels post healthy run-up in the recent past (up 25% in the past week) and absence of any near-term triggers.
Impact: Neutral