Top Battery Stocks – Exide Industries Ltd Vs Eveready Industries India Ltd

Company Overview of Exide Industries Limited

Exide Industries Limited is a company based in India that specializes in designing, manufacturing, marketing, and selling a variety of lead-acid storage batteries. The company is divided into two segments: Storage Batteries & allied products and Life Insurance business. These batteries cater to a wide range of industries including automotive, power, telecom, infrastructure projects, computer industries, railways, mining, and defence sectors. 

The company offers a diverse range of products such as automotive batteries, institutional UPS batteries, inverter batteries, solar solutions, integrated power backup systems, home UPS systems, industrial batteries, genset batteries, e-rickshaw vehicles, and submarine batteries. 

Company Overview of Eveready Industries India Ltd

Eveready Industries India Ltd. is involved in the marketing of dry cell batteries, rechargeable batteries, flashlights, general lighting products, and small home appliances. Additionally, the company distributes various electrical products, small home appliances, and confectionery items. 

Their product range includes batteries branded as Eveready, PowerCell, and Uniross, as well as flashlights and lanterns under the Eveready and PowerCell brands. They also offer LED bulbs, luminaires, and small home appliances under the Eveready brand. 

The stock performance of Exide Industries Ltd

The table below shows the stock performance of Exide Industries Ltd over the past 1 year.

The stock performance of Eveready Industries India Ltd

The table below shows the stock performance of Eveready Industries India Ltd over the past 1 year.

Fundamental Analysis of Exide Industries Limited

Exide Industries Ltd is a leading manufacturer of lead-acid batteries in India, established in 1947. With a strong presence in the automotive and industrial sectors, the company offers a diverse range of batteries for various applications, including electric vehicles, renewable energy storage, and telecommunications. Known for its innovation and quality, Exide has built a robust distribution network and has diversified its product offerings over the years.    

The stock is currently priced at ₹424.05 with a market cap of ₹36,044.25 crore. It offers a 0.47% dividend yield and has a strong 5-year CAGR of 17.04%. Despite a 14.69% drop in the last month, its 1-year return stands at 49.79%.

• Close Price ( ₹ ): 424.05
• Market Cap ( Cr ): 36044.25
• Dividend Yield %: 0.47
• Book Value (₹): 12901.50 
• 1Y Return %: 49.79
• 6M Return %: -9.19
• 1M Return %: -14.69
• 5Y CAGR %: 17.04
• % Away From 52W High: 46.29
• 5Y Avg Net Profit Margin %: 10.02 

Fundamental Analysis of Eveready Industries India Ltd

Eveready Industries India Ltd is a well-established brand known for its innovative battery solutions and lighting products. Founded in the late 19th century, the company has built a strong reputation for offering high-quality and reliable power sources for various devices. 

The stock is priced at ₹374.70 with a market cap of ₹2,723.59 crore and offers a 0.27% dividend yield. Despite a 9.46% drop in the past month, its 1-year return is 7.87%. It has an impressive 5-year CAGR of 46.83%, but a negative average profit margin.

• Close Price ( ₹ ): 374.70
• Market Cap ( Cr ): 2723.59
• Dividend Yield %: 0.27
• Book Value (₹): 386.71 
• 1Y Return %: 7.87
• 6M Return %: 11.35
• 1M Return %: -9.46
• 5Y CAGR %: 46.83
• % Away From 52W High: 34.77
• 5Y Avg Net Profit Margin %: -0.27 

Financial Comparison of Exide Industries and Eveready Industries India Ltd

The table below shows a financial comparison of Exide Industries Ltd and Eveready Industries India Ltd.

Points to be noted:

• EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization): Measures a company’s profitability before accounting for financial and non-cash expenses.
• PBIT (Profit Before Interest and Tax): Reflects operating profit by excluding interest and taxes from total revenue.
• PBT (Profit Before Tax): Indicates profit after deducting operating costs and interest but before taxes.
• Net Income: Represents the company’s total profit after all expenses, including taxes and interest, are deducted.
• EPS (Earnings Per Share): Shows the portion of a company’s profit allocated to each outstanding share of stock.
• DPS (Dividend Per Share): Reflects the total dividend paid out per share over a specific period.
• Payout Ratio: Measures the proportion of earnings distributed as dividends to shareholders.

Dividend of Exide Industries Ltd and Eveready Industries India

The table below shows a dividend paid by the company.

Advantages and Disadvantages of Investing Exide Industries Ltd

Exide Industries Ltd

The primary advantage of Exide Industries Ltd lies in its established position as a leader in the Indian storage battery market, offering a wide range of products for the automotive and industrial sectors.  

1. Market Leadership: Exide is a dominant player in the Indian battery industry, serving both the automotive and industrial sectors. With a strong market presence, it consistently captures a significant share of the battery market through its established brand recognition and product reliability.
2. Wide Product Range: Exide Industries manufactures a diverse range of products, including lead-acid batteries for automobiles, inverters, and industrial applications. Its ability to cater to both consumer and industrial needs helps the company maintain a broad customer base and steady demand.
3. Technological Innovation: The company invests heavily in research and development to improve its products’ efficiency and performance. Exide’s focus on innovation has led to the development of advanced battery technologies that offer better durability, higher efficiency, and environmental sustainability.
4. Strong Distribution Network: Exide’s extensive distribution network spans across India and international markets. With a reach of over 40,000 dealers and service centres, the company ensures timely availability and easy access to its products, bolstering its market presence.
5. Sustainability and Environmental Commitment: Exide is committed to environmental sustainability through initiatives like recycling lead-acid batteries. By reducing the environmental impact and adhering to stringent regulations, the company not only contributes to eco-friendly practices but also gains consumer trust.

The main disadvantages for Exide Industries Ltd stem from fluctuations in raw material costs, particularly lead prices, which significantly impact production costs.  

1. Raw Material Price Volatility: Exide is highly dependent on lead, a key raw material, which is subject to price fluctuations due to global supply-demand dynamics. Any sharp rise in lead prices can negatively affect the company’s profit margins and overall cost structure.
2. Regulatory Challenges: The battery industry faces increasing scrutiny over environmental regulations, especially concerning lead recycling and disposal. Stricter policies or enforcement of laws could impose higher compliance costs or result in penalties, impacting Exide’s financial performance and operations.
3. Intense Competition: Exide operates in a highly competitive market, facing strong competition from both established players and new entrants. Competition in pricing and product innovation pressures the company to constantly upgrade its offerings while maintaining profitability, which could limit growth.
4. Economic Sensitivity: As a consumer-focused brand, Exide’s sales are closely tied to the overall economic environment. Economic slowdowns, reduced consumer spending or declines in vehicle sales can lead to lower demand for its products, adversely affecting revenue growth.
5. Technological Obsolescence: The rapid pace of technological advancements in battery solutions, such as lithium-ion alternatives, poses a risk to Exide’s traditional lead-acid battery market. Failing to adapt to new technologies could render its offerings less competitive and limit long-term growth potential.

Advantages and Disadvantages of Investing in Eveready Industries India Ltd

Eveready Industries India Ltd

The primary advantage of Eveready Industries India Ltd lies in its strong brand recognition and market leadership in the battery and lighting segments. Its wide range of products, extensive distribution network, and focus on innovation help maintain a competitive edge in the market.

1. Strong Brand Recognition: Eveready is one of the most recognized and trusted brands in India, particularly for batteries and flashlights. Its longstanding market presence and reputation for quality provide a significant advantage in consumer preference and brand loyalty.
2. Diverse Product Portfolio: The company offers a broad range of products including dry cells, flashlights, and LED lighting solutions. This diversified portfolio helps Eveready cater to various customer needs, from household to industrial applications, ensuring consistent demand across sectors.
3. Strategic Distribution Network: Eveready boasts an extensive distribution network across urban and rural areas. With over 3,000 distributors and thousands of retailers, it ensures the wide availability of its products, strengthening its presence in both large and small markets.
4. Focus on Innovation: Eveready has focused on continuous innovation to stay ahead in the competitive market. The company has invested in modern battery technologies and energy-efficient lighting solutions, adapting to changing consumer preferences and technological trends.
5. Strong Financial Performance: Eveready has demonstrated a solid financial performance over the years, supported by a stable revenue base and consistent profitability. The company’s ability to maintain steady growth amid competition reflects its operational efficiency and market resilience.

The main disadvantage for Eveready Industries India Ltd lies in the intense competition within the battery and lighting sectors. As more players enter the market, pricing pressures, innovation demands, and the threat of brand erosion could significantly impact profitability.

1. Intense Market Competition: Eveready faces significant competition from both established brands and newer market entrants, which leads to aggressive pricing strategies. Such competition can erode market share and pressure profit margins, making it challenging to maintain growth and brand loyalty.
2. Raw Material Price Fluctuations: Eveready’s products, especially batteries, rely heavily on raw materials like zinc and manganese. Fluctuations in global commodity prices can increase production costs, putting pressure on margins and potentially leading to price hikes that may affect consumer demand.
3. Economic Sensitivity: Consumer demand for Eveready’s products is sensitive to economic conditions. In times of economic downturns or lower consumer spending, sales of discretionary items like batteries and lighting could decline, adversely affecting the company’s revenue and profitability.
4. Technological Disruption: With the increasing shift toward rechargeable batteries and solar lighting solutions, Eveready’s traditional offerings could face obsolescence. The company’s failure to adapt quickly to these technological trends may risk losing market relevance in the evolving energy sector.
5. Regulatory and Environmental Concerns: Eveready must comply with strict environmental regulations, especially concerning battery disposal and recycling. Non-compliance with these standards could lead to penalties, increased operational costs, or reputational damage, affecting long-term sustainability and profitability.

How to Invest in Exide Industries Ltd and Eveready Industries India Ltd?

To invest in Exide Industries Ltd and Eveready Industries India Ltd, the process involves selecting a stockbroker, opening a trading account, researching the companies, and placing buy orders through the broker’s platform.  

1. Choose a Stock Broker: To begin, select a reputable stockbroker such as Alice Blue, which offers low brokerage fees, easy access to trading platforms, and various tools for research. A good broker ensures smooth execution of your trades and secure management of your investments.
2. Open a Demat & Trading Account: Once you’ve chosen a broker, open a Demat account to hold your stocks and a trading account to execute buy and sell orders. These accounts are essential for buying shares of companies like Exide and Eveready.
3. Research the Companies: Before investing, thoroughly research the financial health, growth potential, and market performance of Exide and Eveready. Study key metrics like earnings, dividend yield, and historical returns to make informed investment decisions and assess their long-term viability.
4. Place Buy Orders: Once you’ve done your research, use your trading platform to place a buy order for the desired number of shares in Exide Industries Ltd or Eveready Industries Ltd. Monitor the market to ensure you’re purchasing at a favourable price.
5. Monitor Your Investments: After purchasing shares, regularly track their performance by reviewing company reports, stock price movements, and market news. Adjust your portfolio if needed, depending on market trends and your investment goals. This helps in maximizing returns and mitigating risks.

Exide Industries Ltd vs. Eveready Industries India Ltd – Conclusion

Exide Industries Ltd is a leading player in the battery and energy storage market, with a strong brand and diverse product portfolio. Its consistent performance, robust market share, and focus on innovation make it a solid choice for long-term investors, despite risks like raw material price fluctuations.

Eveready Industries India Ltd, known for its strong brand in the battery and lighting segments, offers promising growth potential with its diversified product range. However, the company faces intense competition, raw material cost pressures, and technological disruption risks, requiring careful consideration before investing.

Top Battery Stocks – Exide Industries Ltd vs. Eveready Industries India Ltd – FAQ

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Disclaimer: The above article is written for educational purposes, and the companies’ data mentioned in the article may change with respect to time. The securities quoted are exemplary and are not recommendatory.