Exide Industries Q2 results, 14% Decline in net profit, Share price drop by 4%

Exide Industries saw its share price drop by 4% after reporting a 14% decline in net profit year-on-year (YoY) for the second quarter of the fiscal year. The stock reached an intraday low of ₹437.70 on the Bombay Stock Exchange (BSE) amid broader market trends. As of 1:40 PM, shares were down 3.66% at ₹443.50, compared to a 1.63% decline in the BSE Sensex, which stood at 78,423.93 points.

Quick Insights

• Revenue: ₹4,267 crore, up by 3.89% YoY.
• Net Profit: ₹233.4 crore, decreased by 13.7% compared to last year.
• EBITDA: ₹472 crore, down 5.5% YoY.
• Management's Take: Strong growth driven by ongoing investments in the lithium-ion battery plant and a focus on strengthening the product portfolio and distribution network. Outlook remains positive."
• Stock Reaction: Exide Industries shares fell by 4.6% to ₹437.80, hitting a five-month low as of 4th Nov 2024. 

Management Commentary

Avik Roy, MD & CEO, stated, "For the near-term, business outlook is positive, and commodity prices have started easing, which is expected to support profitability." He highlighted ongoing investments in the lithium-ion battery plant and a focus on strengthening the product portfolio and distribution network.

Exide invested ₹250 crore as equity in Exide Energy Solutions Ltd. (EESL), with total investments to date reaching ₹2,852.24 crore.

Construction of a 12 GWh lithium-ion battery manufacturing plant near Bengaluru is progressing well, with all operational functions working diligently towards project completion.

Stock Market Reaction

Despite the recent drop, Exide shares price have gained 79% over the past year, outpacing the 24% rise of the BSE Sensex, with a three-year compound annual growth rate (CAGR) of 37%. However, the stock has fallen 8.6% in the last 30 days amid a soft market.

About Exide Industries

Despite a decline in net profit due to higher expenses, Exide Industries showed resilience with marginal revenue growth and positive demand in key markets. The long-term outlook remains optimistic, supported by strategic investments and easing commodity prices. Avik Roy, MD & CEO of Exide Industries, expressed a positive near-term outlook, citing easing commodity prices as a potential support for profitability. The company already has a plant in Prantij, Gujarat, for production, assembly and sale of lithium-ion battery modules and packs. "We are in the process of identifying and onboarding domestic and international suppliers...," the company said in the media statement.