Stocks of battery manufacturer Amara Raja Energy and Mobility (AREM) soared over 16 per cent in the Tuesday trading session after its subsidiary signed an agreement with a subsidiary of a Chinese firm.
AREM traded at Rs 1,602 with Rs 221 or 16 per cent gain in the afternoon session at the National Stock Exchange (NSE).
Notably, Andhra Pradesh CM, Chanrababu Naidu is also invested in AREM, whereas Jay Dev Gall, Managing Director, AREM was a former member of parliament from Telugu Desam Party (TDP).
Amara Raja Advanced Cell Technologies (ARACT), a subsidiary of AREM, signed a technical licensing agreement with GIB EnergyX Slovakia, a subsidiary of Gotion High-tech company for lithium-ion cells to ARACT.
This licensing also provided AREM access to cell technology IP, support in establishing gigafactory facilities compatible with the latest generation process technologies, integration with Gotion’s global supply chain network for critical battery materials, and customer technical support for solution deployment.
The technology transfer and service support will boost AREM’s efforts to operationalise its gigafactory manufacturing capacities and its research and innovation centre, ‘ePositive Energy Labs’, that aims to lead India’s research and development (R&D) capabilities in this field.
A few brokerages have made calls on the counter in response to the development. JP Morgan gave a neutral recommendation to AREM with a target price of Rs 1,210 per share.
“Last year's announcements on our investments in the new energy space are part of ushering in a new era we are calling Amara Raja 3.0. We firmly believe that India will be one of the fastest growing EV markets, and that Gotion’s globally proven technology coupled with our three decades of expertise in the energy and mobility space will be a winning combination,” said Jayadev Galla, Chairman, Managing Director, AREM.
Last year, Amara Raja said it would invest Rs 9,500 crore to establish the AREM giga corridor in Telangana. AREM and Gotion are both shareholders and board members of InoBat.
“Indian market has a significant growth potential, and they appreciate Amara Raja’s corporate values, success in the Indian market with energy storage products and the strong customer relationships they have built over the years,” said Commenting on the Indian market, Steven Cai, Chairman, GIB EnergyX and Director, Gotion HighTech.
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