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Informist, Thursday, Jan. 29, 2026

 

By Gopika Balasubramanium

MUMBAI – Exide Industries Ltd. is expected to make a rebound in the December quarter after a subdued trailing quarter, with both top line and bottom line seen growing at the fastest pace in seven quarters. The company's revenue growth, seen in early teens, is likely driven by robust demand for its industrial segment products and a healthy increase in its replacement and automobile segment volumes. The company's profit margin is seen expanding sequentially, but may feel the pinch on an year-on-year basis due to higher input costs. 

The Kolkata-based company's net profit is seen jumping 16% on year and 29% on quarter to INR 2.84 billion, the average of estimates from six broking firms showed. Elara Securities (India) Pvt. Ltd. has the highest estimate for net profit at INR 3.62 billion and Nuvama Wealth Management has the lowest estimate of net profit at INR 2.31 billion.

 

The battery manufacturer's revenue from operations is expected to rise 12% on year to INR 43.09 billion, according to the consensus estimate. Sequentially, this translates to a 3% rise in the company's top line. Motilal Oswal Financial Services has the highest estimate for revenue at INR 44.26 billion and Nuvama Wealth Management has the lowest estimate at INR 41.70 billion.

 

Kotak Securities Ltd. expects a high single-digit on-year increase in industrial segment demand to support growth in revenue. A healthy double-digit on-year increase in replacement and automobile segment volumes, partly on account of channel filling, is also seen improving overall sales growth, Kotak Securities said in its earnings preview report. 

 

In the trailing quarter, the company's revenue had declined over 2% on year to INR 41.78 billion, a first in 21 quarters. This fall in sales was on account of channel partners temporarily postponing purchases after the announcement of the cut in the goods and services tax, in anticipation of receiving new stocks with lower prices. In order to tackle costs, the company took production cuts in August and September. The company's net profit for the September quarter slid nearly 26% on year to INR 2.21 billion. Since then, the stock has fallen more than 16%. On Thursday, shares of the company closed slightly lower at INR 320.85 on the National Stock Exchange.  
  

The company's earnings before interest, tax, depreciation, and amortisation are seen at INR 4.80 billion, up 7% on year, as per the average of six estimates. Nomura Equity Research has the highest estimate for the battery maker's EBITDA at INR 5.15 billion and Nuvama has the lowest estimate at INR 4.29 billion. 

 

All six brokerages expect the company's EBITDA margin to expand from the trailing quarter. Sequentially, the margin is expected to expand from the high of 268 basis points forecast by Nomura to the low of 84 bps seen by Nuvama. Kotak expects EBITDA margin to rise 170 bps on quarter in Oct-Dec due to "operating leverage benefit" and a "richer product mix." On a year-on-year basis, all but Nomura expect the margin to contract between 20-137 bps owing to pressure from a rise in expenses. In the September quarter, the battery-maker's margin was 9.4%. Post the results, the management had said they expect to maintain the margin at 12-13% in the upcoming quarters. 

 

The Kolkata-based company will release its quarterly results Friday, and investors are expected to monitor management's comments on the progress of its subsidiary Exide Energy Solutions Ltd.'s lithium-ion manufacturing facility in Bengaluru. So far, the company has invested a total of INR 42 billion in this subsidiary. The management had said the equipment installation and commissioning works in Exide Energy are nearing completion and production at this facility is expected to commence by the end of 2025-26 (Apr-Mar).

 

Brokerages are largely bullish on Exide, with eight of 14 research reports recommending a 'buy' with an average target price on the stock at INR 475, which implies an upside of 48% from the current market price. Four brokerages have a 'hold' recommendation on the stock at an average target price of INR 379, while two recommended selling the stock. 

 

Following are the December quarter earnings estimates for Exide Industries from six brokerages in descending order of the estimate of net profit in INR billion:

 

Brokerage	Sales	PAT	EBITDA
Nomura Equity Research	42.49	2.89	5.15
Motilal Oswal Financial Services Ltd	44.26	2.85	5.09
Kotak Securities Ltd	43.87	2.78	4.89
YES Securities (India) Ltd	43.49	2.59	4.73
Elara Securities (India) Pvt Ltd	42.72	3.62	4.66
Nuvama Wealth Management Ltd	41.70	2.31	4.29
Average	43.09	2.84	4.80

 

End

 

Edited by Tanima Banerjee

 

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