The management of the battery manufacturer stated that they are in the advanced stages of talks with several parties regarding a more extensive cell partnership.
Amara Raja, an Indian battery manufacturer, is actively engaged in discussions to establish a new partnership aimed at strengthening its lithium-ion cell manufacturing capabilities. This collaboration focuses on enhancing various aspects such as cell technology, supply chain logistics, and manufacturing expertise. The company is currently developing a large-scale giga factory, which emphasizes its commitment to advancing these areas.
During a recent post-earnings call, Vikramadithya Gourineni, the Executive Director for New Energy Business at Amara Raja, informed investors that the company is nearing the final stages of discussions with various entities to forge a comprehensive partnership in cell technology, manufacturing know-how, and supply chain management.
The forthcoming giga factory in Telangana is set to dramatically increase the company’s production capacity, featuring 16 GWh of cell capacity and 5 GWh of battery pack capacity over the next decade. The initial phase of this factory, with a 2 GWh capacity, is expected to commence commercial operations by the end of the 2025-26 fiscal year.
Initially, the factory will produce Nickel Manganese Cobalt (NMC) based 2170 cylindrical cells, developed in collaboration with a Chinese partner whose name was not disclosed by the company. These cells will primarily serve the two-wheeler market. Over time, Amara Raja plans to expand its cell chemistry offerings to include Lithium Iron Phosphate (LFP) and others.
Chief Financial Officer Delli Babu highlighted that their current NMC cell suppliers are reliable and have operations in multiple geographic locations. Looking forward, Amara Raja is seeking to establish a broader partnership that would allow the company to address a wider market segment. This includes exploring high-voltage battery packs for electric mobility and tapping into well-established supply chains which offer competitive rates.
While the company is open to various partnership models, including equity participation and joint ventures, Gourineni pointed out that a technology licensing agreement is presently the most likely arrangement.
Amara Raja’s strategy is set against the backdrop of its main competitor, Exide Industries, which has secured a partnership with China-based SVOLT Energy Technology Co Ltd. Through this collaboration, Exide has gained access to SVOLT’s cutting-edge technology and expertise in lithium-ion cell manufacturing, positioning itself as a formidable player in the market.
