Amara Raja Energy & Mobility Ltd (ARE&M) AI Stock Analysis

• Market Cap: ₹151.21B
• Dividend Yield: 6.72%
• Average Volume (3M): 25.52K
• Price to Earnings (P/E): 20.4
• Beta (1Y): 1.60
• Revenue Growth: 5.90%
• EPS Growth: -8.73%
• Country: IN
• Employees: 8,280
• Sector: Energy
• Sector Strength: 52
• Industry: Electrical Equipment & Parts
• EPS (TTM): 10.70
• Shares Outstanding: 183,025,360
• 10 Day Avg. Volume: 21,379
• 30 Day Avg. Volume: 25,516
• PEG Ratio: 0.01
• Price to Book (P/B): 0.54
• Price to Sales (P/S): 2.81
• P/FCF Ratio: 5.90
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: N/A
• Price Target Upside: N/A
• Rating Consensus: N/A
• Number of Analyst Covering: 0
• EPS Forecast (FY): 42.3
• Revenue Forecast (FY): ₹134.01B

• Rating: 77 Outperform
• Price Target: ₹937.00 ▲(1.63% Upside)
• Action: Reiterated Date: 12/18/25
• Date: Action: Reiterated 12/18/25

Amara Raja Energy & Mobility Ltd's strong financial performance and attractive valuation are key strengths, though technical analysis is limited due to missing data. The company's stable balance sheet and high dividend yield enhance its appeal, but attention to cash flow management is necessary.

Positive Factors

Revenue growth with healthy margins

Sustained revenue expansion combined with healthy gross and net margins and solid EBIT/EBITDA indicates the business retains pricing power and operational efficiency. That supports durable profitability, funds reinvestment in battery tech, and underpins long-term cash generation across cycles.

Stable balance sheet and prudent leverage

A low debt-to-equity ratio and strong equity ratio provide financial flexibility for capital spending and technology investments in EV and energy storage. Prudent leverage reduces refinancing risk and preserves capacity to pursue partnerships or scale production during multi‑year transitions.

Positive operating cash flow supporting investments

Consistent operating cash flow that supports net income provides an internal funding source for R&D and capacity expansion in batteries and energy systems. Reliable cash generation sustains long-term product development and execution of strategic partnerships without overreliance on external financing.

Negative Factors

Volatile and declining free cash flow

Fluctuating and recently declining free cash flow can constrain capital allocation for manufacturing scale‑up, R&D and backlog fulfillment in EV and storage markets. Persistent volatility raises execution risk and may necessitate external funding during multi‑year growth investments.

Increase in total debt in latest period

A recent rise in total debt, even from a low base, reduces financial headroom for cyclical downturns and large capex projects. If the debt trend continues it could elevate interest costs, limit strategic flexibility for EV capacity expansion, and pressure credit metrics over the medium term.

Earnings pressure and EPS decline

Material negative EPS growth alongside a modest EBIT decline signals emerging profitability headwinds, possibly from cost, mix shifts, or investment dilution. Continued earnings pressure would weaken internal funding for strategic initiatives and could slow the pace of product development and capacity buildout.

Amara Raja Energy & Mobility Ltd Business Overview & Revenue Model

Company Description

Amara Raja Energy & Mobility Limited manufactures and sells lead-acid storage batteries for industrial and automotive applications in India. The company also provides installation, commissioning, and maintenance services. It sells its batteries under the Amaron, PowerZone, Power Stack, AmaronVolt, and Quanta brands. The company exports its products to various countries in the Indian Ocean Rim. It supplies its batteries to various customer groups, such as telecom, railways, solar, power control, and UPS; and automobile OEMs, replacement markets, and private label customers. The company was formerly known as Amara Raja Batteries Limited and changed its name to Amara Raja Energy & Mobility Limited in September 2023. The company was incorporated in 1985 and is based in Hyderabad, India.

How the Company Makes Money

ARE&M generates revenue primarily through the manufacturing and sale of batteries for various applications, including automotive, industrial, and renewable energy sectors. Key revenue streams include the production of lead-acid batteries for conventional vehicles, lithium-ion batteries for electric vehicles, and energy storage solutions for renewable energy systems. The company also benefits from strategic partnerships with automotive manufacturers, technology providers, and government initiatives aimed at promoting electric mobility and sustainable energy solutions. Additionally, ARE&M's involvement in R&D and innovation allows it to develop new products that meet evolving market demands, further enhancing its revenue potential.

Amara Raja Energy & Mobility Ltd Financial Statement Overview

Summary

Amara Raja Energy & Mobility Ltd shows strong financial health with consistent revenue growth and profitability. The balance sheet is stable with manageable leverage, but fluctuations in free cash flow require attention.

Income Statement

Amara Raja Energy & Mobility Ltd has demonstrated strong revenue growth over the years, with a notable increase in total revenue from 2020 to 2025. The company maintains healthy gross and net profit margins, indicating efficient cost management and profitability. The EBIT and EBITDA margins are solid, reflecting robust operational performance. However, the slight decline in EBIT from 2024 to 2025 suggests potential challenges in operational efficiency.

Balance Sheet

The company's balance sheet shows a stable financial position with a low debt-to-equity ratio, indicating prudent financial leverage. The return on equity has improved over the years, showcasing effective use of shareholders' funds. The equity ratio remains strong, reflecting a solid capital structure. However, the increase in total debt from 2024 to 2025 could pose a risk if not managed carefully.

Cash Flow

Amara Raja Energy & Mobility Ltd has shown positive operating cash flow, supporting its net income effectively. The free cash flow has fluctuated, with a decline in recent years, which could impact future investments and growth opportunities. The operating cash flow to net income ratio is strong, indicating good cash generation relative to earnings. However, the free cash flow to net income ratio has been inconsistent, suggesting potential volatility in cash flow management.

Breakdown	TTM	Mar 2025	Mar 2024	Mar 2023	Mar 2022	Mar 2021
Income Statement
Total Revenue	129.84B	128.46B	117.08B	103.39B	86.55B	71.33B
Gross Profit	38.30B	41.67B	36.96B	31.89B	24.06B	22.91B
EBITDA	17.58B	18.43B	17.60B	14.71B	11.01B	11.96B
Net Income	8.60B	9.45B	9.34B	7.31B	5.13B	6.47B
Balance Sheet
Total Assets	0.00	101.68B	89.78B	79.62B	63.76B	57.97B
Cash, Cash Equivalents and Short-Term Investments	4.91B	4.91B	4.56B	2.67B	748.00M	4.45B
Total Debt	0.00	2.61B	1.57B	2.01B	1.26B	923.20M
Total Liabilities	-73.89B	27.79B	21.79B	19.55B	18.24B	15.87B
Stockholders Equity	73.89B	73.89B	67.99B	60.07B	45.52B	42.10B
Cash Flow
Free Cash Flow	1.51B	1.51B	3.95B	4.34B	-1.28B	3.06B
Operating Cash Flow	13.51B	13.51B	12.66B	9.45B	6.33B	8.02B
Investing Cash Flow	-11.32B	-11.32B	-10.20B	-7.73B	-4.82B	-6.35B
Financing Cash Flow	-1.60B	-1.60B	-2.42B	-1.12B	-2.13B	-1.22B

Amara Raja Energy & Mobility Ltd Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
ARE&M	77 Outperform	₹151.21B	20.35	―	6.72%	5.90%	-8.73%
KPIGREEN	72 Outperform	₹71.50B	16.62	―	0.20%	70.67%	59.54%
TDPOWERSYS	70 Outperform	₹139.37B	63.45	―	0.23%	40.14%	53.51%
Sector *	65 Neutral	$15.17B	7.61	4.09%	5.20%	3.87%	-62.32%
WAAREERTL	62 Neutral	₹86.99B	20.86	―	―	63.07%	74.37%
BORORENEW	46 Neutral	₹61.76B	-88.44	―	―	7.68%	-114.23%
SWSOLAR	43 Neutral	₹44.32B	-11.40	―	―	112.24%	-474.43%