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Exide Industries Limited is significantly boosting its investment in its electric vehicle battery subsidiary, Exide Energy Solutions. This ₹450 crore capital injection is part of a larger commitment aimed at capturing growth in India's expanding EV market. The move comes as the subsidiary navigates initial financial challenges.
Exide Industries announced the ₹450 crore investment on March 25, 2026, through a rights issue to Exide Energy Solutions. This investment increases Exide Industries' total commitment to its EV battery subsidiary to ₹4,802.23 crore. The capital is designated for building a new manufacturing facility in Bengaluru that will produce lithium-ion battery cells, modules, and packs. Exide Industries maintained its 100% ownership of the subsidiary. Following the announcement, Exide Industries' shares closed at ₹307.20, up 2.91% for the day.
Exide Energy Solutions, founded in March 2022, reported a net loss of ₹209.12 crore for the fiscal year ending March 31, 2025. This loss occurred on a turnover of ₹116.89 crore. In comparison, Exide Industries' stock traded around March 2026 with a Price-to-Earnings (P/E) ratio of about 29.9x. Its competitor, Amara Raja Energy & Mobility, had a trailing twelve months (TTM) P/E ratio in the range of 13.7x to 18.7x during the same period. The Indian government actively supports the EV battery manufacturing sector through programs like the Advanced Chemistry Cell Production Linked Incentive (ACC PLI) scheme, with an outlay of INR 181 billion. However, the scheme has faced delays, with only 2.8% of its 50 GWh capacity target commissioned by October 2025, due to implementation issues and strict value addition rules. New subsidy programs for lithium and nickel processing are scheduled to begin April 1, 2026. Analyst opinions are mixed; MarketsMojo rated the stock a 'Sell' in March 2026, citing valuation and technical factors. Other analysts hold a 'Moderate Buy' consensus, with 12-month price targets around ₹430 to ₹435.
Concerns exist regarding the profitability timeline and the ability to manage rising costs, given the large capital investment in Exide Energy Solutions, which is currently unprofitable. The total investment commitment is approaching ₹5,000 crore, with the subsidiary's FY25 loss surpassing ₹200 crore. The battery manufacturing industry requires substantial capital and is susceptible to price swings in raw materials like silver, tin, copper, and sulfur, contributing to cost pressures. The slow progress of the ACC PLI scheme, with many capacity targets unmet by October 2025, illustrates the practical difficulties in expanding domestic production, including the need for foreign technical expertise. Exide Industries' stock performance has also been weak, showing a one-year return of approximately -14.86% by March 2026. A 'Sell' rating from MarketsMojo in March 2026 adds to a cautious perspective.
Exide Industries recently reported surpassing ₹4,000 crore in revenue during its third quarter of FY25-26. This was accompanied by an increase in its EBITDA margin to 11.7%, attributed to higher sales volumes and improved cost management. According to company presentations, Phase 1 of its Bengaluru lithium-ion cell manufacturing plant is anticipated to start operations by Q3 FY2026. Significant capital expenditure has already been invested and is planned for FY2026. Despite current challenges, the average analyst price target remains around ₹430, suggesting optimism among some analysts about the long-term prospects of Exide's move into EV batteries.