scorecardresearch

Exide’s Li-ion cell unit likely to be ready in 2.5 yrs

Construction work for the project is likely to start soon, and funding will mainly come from internal accruals.

Exide’s Li-ion cell unit likely to be ready in 2.5 yrs
In the first phase of the Rs 6000-crore project, the company will invest close to Rs 4,000 crore.

Storage battery major Exide Industries expects the first phase of its multi-gigawatt-hour lithium-ion cell manufacturing facility in Karnataka to be ready for commercial production in two-and-half years.

In the first phase of the Rs 6000-crore project, the company will invest close to Rs 4,000 crore. Construction work for the project is likely to start soon, and funding will mainly come from internal accruals.

Also Read: Exide Industries Q1 PAT rises six-fold to Rs 202.44 crore

“Under Exide Energy Solutions, your company is setting up a multi-gigawatt hour Li-Ion cell manufacturing facility spread over 80 acres of land in the state of Karnataka,” Exide Industries MD & CEO Subir Chakraborty told shareholders at the company’s 75th annual general meeting on Thursday.

Talking to the media later, Chakraborty said the first phase of the plant (6 gigawatt-hour) is expected to be completed in 27-30 months. The company plans to expand the size of the plant, which will produce cells, modules and packs, up to 12 gigawatt-hour over 8-10 years, investing a total of around Rs 6,000 crore.

“We are a debt-free company and have sufficient reserves. We will look at internal accruals and some bridge loan facilities from banks as and when required,” Chakraborty said on the funding of the project.

To set up the plant, Exide Industries has entered into a multi-year technical collaboration agreement with China’s SVOLT Energy Technology. The global technology company makes and develops lithium-ion batteries and battery systems for electric vehicles as well as for energy storage.

Also Read: Exide Industries’ board gives ‘in-principle’ nod to set up multi-gigawatt lithium-ion cell manufacturing plant

“As part of the agreement, SVOLT is providing Exide an irrevocable right and licence to use, exploit and commercialise necessary technology and knowhow owned by them for Li-Ion cell manufacturing in India,” Chakraborty said, adding the Chinese company is also providing the requisite support to set up a new manufacturing plant on a turnkey basis.

The total size of the advanced chemistry cell (ACC) battery market in India is expected to be around 100 gigawatt-hour by 2030. Exide expects to generate annual revenue of around Rs 12,000 crore from the lithium-ion cell manufacturing business in the next 8-10 years. “During 2021-22, electric vehicle sales have increased by 3x over the previous financial year, though on a lower base. Almost all OEMs have decided to cater to this increasing demand and several companies are currently making significant investments in this emerging sector. Unlike ICE vehicles, battery and battery management system is expected to form nearly 40-50% of the of an electric vehicle. Hence, increased EV adoption is likely to result in an increase in demand for batteries and associated BMS,” Chakraborty told shareholders.

Get live Share Market updates and latest India News and business news on Financial Express. Download Financial Express App for latest business news.