Exide Industries Shares Pare Early Gains But SEBI RA Sees 18% Potential Upside
Synopsis
Exide announced an additional investment of ₹80 crore in its wholly owned subsidiary, Exide Energy Solutions (EESL), through a rights issue
Shares of Exide Industries reversed early-session gains to trade 0.7% lower at ₹390.50 as broader markets experienced sharp declines in the afternoon.
Post-market hours on Thursday, Exide announced an additional investment of ₹80 crore in its wholly owned subsidiary, Exide Energy Solutions (EESL), through a rights issue. This brings the total investment in EESL to ₹3,882.23 crore.
EESL manufactures and sells lithium-ion battery cells, modules and packs for the electric vehicle market and stationary applications.
Analyst's Take
Technically, the stock remains in a consolidation phase, noted SEBI-registered analyst Ashok Kumar Aggarwal.
https://stocktwits.com/equitycharcha/message/630086908
For investors with a medium-term outlook, analysts recommend a buying range of ₹393.50 - ₹395.50, with a stop-loss at ₹371 on a closing basis.
Exide’s price targets are pegged at ₹442 – ₹460, reflecting a moderate upside potential, the analyst said.
The company’s dual strategy of strengthening its core business while investing aggressively in new-age energy solutions makes it a stock to watch closely in the evolving energy and mobility landscape, he added.
The company is making significant strides in lithium-ion technology for electric mobility and stationary power applications, two areas expected to see strong growth in the coming years, Aggarwal said.
From a financial perspective, Exide is currently trading at a price-to-earnings (PE) ratio of 39.7, with a return on capital employed (ROCE) of 8.65 and return on equity (ROE) of 5.74.
While these metrics may not appear highly attractive, the company’s market leadership and diversification into new energy solutions add a layer of long-term potential, he said.
Stock Watch
Retail sentiment on Stocktwits shifted to ‘neutral’ from ‘bullish’ a day earlier.
Year-to-date, the stock has shed 6.4%.
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