Manufacturing of Battery in India

Introduction-

Many kinds of batteries exist, and as new systems are developed to commercial maturity, they have been applied to the problem of electrified transportation. A Rough plot of some of the more common battery technologies is shown in Figure. Early EV applications used the rechargeable Lead-Acid battery developed in 1859 by Gaston Planté. In 1899, Waldemar Jungner introduced the nickel-cadmium battery that made significant improvements in storage capacity but had some drawbacks including a voltage suppression issue that occurs as the battery ages, known as a memory effect. Research continued through the beginning and latter half of the 20th century, but it was not until 1985 that the first lithium-ion (Li-ion) batteries were created. It took a further 6 years of research before they were commercialized. In the meantime, EVs using ZEBRA batteries and Nickel-Metal Hydride batteries were developed. The current predominant battery energy storage technology for EVs is the Li-ion battery.

Batteries are fundamentally a storage medium made up of two electrodes in an electrolyte. This electrolyte provides a medium for the exchange of ions which produces the electricity. Recent innovations in Li-ion batteries have propelled them to become the market leader for use in most handheld and portable electronics as well as EVs. This is primarily due to their specific energy (Wh/kg), cycle life and high efficiency.

Design and Working-

All batteries utilize similar procedures to create electricity; however, variations in materials and construction have produced different types of batteries. Strictly speaking, what is commonly termed a battery is actually a group of linked cells. The following is a simplified description of how a battery works.

Two important parts of any cell are the anode and the cathode. The cathode is a metal that is combined, naturally or in the laboratory, with oxygen—the combination is called an oxide. Iron oxide (rust), although too fragile to use in a battery, is perhaps the most familiar oxide. Some other oxides are actually strong enough to be worked (cut, bent, shaped, molded, and so on) and used in a cell. The anode is a metal that would oxidize if it were allowed to and, other things being equal, is more likely to oxidize than the metal that forms part of the cathode.

A cell produces electricity when one end of a cathode and one end of an anode are placed into a third substance that can conduct electricity, while their other ends are connected. The anode draws oxygen atoms toward it, thereby creating an electric flow. If there is a switch in the circuit (similar to any wall or lamp switch), the circuit is not complete, and electricity cannot flow unless the switch is in the closed position. If, in addition to the switch, there is something else in the circuit, such as a light bulb, the bulb will light from the friction of the electrons moving through it.

The third substance into which the anode and the cathode are placed is called an electrolyte. In many cases this material is a chemical combination that has the property of being alkaline. Thus, an alkaline battery is one that makes use of an alkaline electrolyte. A cell will not produce electricity by itself unless it is placed in a circuit that has been rendered complete by a simple switch, or by some other switching connection in the appliance using the battery.

Designing a cell can lead to many variations in type and structure. Not all electrolytes, for example, are alkaline. Additionally, the container for the electrolyte can act as both a container and either the cathode or the anode. Some cells draw their oxygen not from a cathode but right out of the air. Changes in the compositions of the anode and the cathode will provide more or less electricity. Precise adjustment of all of the materials used in a cell can affect the amount of electricity that can be produced, the rate of production, the voltage at which electricity is delivered through the lifetime of the cell, and the cell's ability to function at different temperatures.

Manufacturing of Batteries-

1. The cathode

In an alkaline battery, the cathode actually doubles as part of the container. Huge loads of the constituent ingredients—manganese dioxide, carbon black (graphite), and an electrolyte (potassium hydroxide in solution)—delivered by train and mixed in very large batches at the production site. The mixture is then granulated and pressed or compacted into hollow cylinders called preforms. Depending on the size of the battery being made, several preforms may be stacked one on top of another in a battery. Alternatively, the series of preforms can be replaced by an extruded ring of the same material.

The preforms are next inserted into a nickel-plated steel can; the combination of the preforms and the steel can make up the cathode of the battery. In a large operation, the cans are made at the battery factory using standard cutting and forming techniques. An indentation is made near the top of the can, and an asphalt or epoxy sealant is placed above the indentation to protect against leakage.

2. The separator

A paper separator soaked in the electrolyte solution is then inserted inside the can against the preforms; the separator is made from several pieces of paper laid at cross grains to each other (like plywood). Looking down at an open can, one would see what looks like a paper cup inserted into the can. The separator keeps the cathode material from coming into contact with the anode material. As an alternative, a manufacturer might use a porous synthetic fiber for the same purpose.

3. The Anode

The anode goes into the battery can next. It is a gel composed primarily of zinc powder, along with other materials including a potassium hydroxide electrolyte. This gel has the consistency of a very thick paste. Rather than a solution, it is chemically a suspension, in which particles do not settle (though an appropriate filter could separate them). The gel does not fill the can to the top so as to allow space for the chemical reactions that will occur once the battery is put into use.

4. Packaging

Though the battery is able to produce electricity at this point, an open cell is not practical and would exhaust its potential rapidly. The battery needs to be sealed with three connected components. The first, a brass "nail" or long spike, is inserted into the middle of the can, through the gel material and serves as a "current collector." The second is a plastic seal and the third a metal end cap. The nail, which extends about two-thirds of the way into the can, is welded to the metal end cap and then passed through the plastic seal.

This seal is significantly thinner in some places than in others, so that if too much gas builds up in the can, the seal will rupture rather than the entire battery. Some battery designs make use of a wax-filled hole in the plastic; excess gas pushes through the wax rather than rupturing the battery. The seal assembly meets the indentation made in the can at the beginning of the process and is crimped in place.The opposite end of the can (the positive end of the battery) is then closed with a steel plate that is either welded in place or glued with an epoxy-type cement.

5. The label

Before the battery leaves the factory, a label is added identifying the type of battery, its size, and other information. The label is often paper that is simply glued to the battery. One large manufacturer has its label design printed on plastic shrink wrap: a loose-fitting piece of heat-sensitive plastic is wrapped around the battery can and then exposed to a blast of heat that makes the plastic shrink down to fit tightly around the can.

Quality Control-

Because battery technology is not especially new or exotic, quality control and its results are especially important as the basis for brand competition. The ability of a battery to resist corrosion, to operate well under a variety of conditions, to maintain a good shelf and usage life, and other factors, are the direct results of quality control. Batteries and ingredients are inspected and tested at almost all stages of the production process, and the completed batches are subjected to stringent tests.

Market Scenario-

In the battery manufacturing domain in India there are several prominent companies. E.g.- Exide Industries is one of the largest manufacturers of automotive and industrial lead-acid batteries in India and fourth largest in the world. And has been in the business from 1905. There are many other names such as ‘Amara Raja Batteries Ltd’ and ‘Luminous Power Technologies Pvt Ltd’; but in recent times the battery manufacturing sector in India got a boost because of new thriving technology developments in electric powered vehicles and lithium-ion batteries.

1.GOLDSTAR POWER Ltd: -

Established in the year 1982 by Mr. Muljibhai Pansara as a partnership firm at a small place at Dhrol, Dist. Jamnagar. The Company spread over an area of Approx., 100000 Sq. Ft. The company is a fully integrated unit having all production facilities under a single roof.

Incorporated in the year 1999, it is a battery manufacturing Company, manufacturing & marketing products under flagship brand -GOLDSTAR. With its state of art manufacturing facilities with an installed capacity of 50,000 batteries per month at Jamnagar in Gujarat.

The company has developed a niche space for itself for Lead Acid Batteries for Automotive, Industrial, Motorcycle, UPS, Solar, Genset and Inverter applications.

• Revenue: Rs 36.37 Cr
• Market Cap: 24.28 Cr.
• ROE: 5.39 %
• Sales Growth (3Yrs): -3.15 %
• Promoter holding: 72.91 %
• Debt to equity: 0.41
• Price to book value: 1.26

The product range covers various types of batteries including Fully Automotive Batteries for Car, Tractor and Heavy Duty Trucks, Tubular Batteries for Inverter and Solar Application, SLI and Tubular Batteries for E-Rickshaw, SMF-VRLA Batteries for UPS Application, Motorcycle Batteries, Solar Batteries, Pure Lead, and Alloy batteries.

The company has a wide customer base with our domestic customer base situated in various regions of the country and international customers situated across varied countries like Dubai, Uganda, Nepal, Lebanon, Afghanistan, Oman, Yemen, etc.

2. HIGH ENERGY BATTERIES(INDIA) Ltd.: -

High Energy Batteries (India) Limited is an established manufacturer of Hi- Tech batteries for use in Army, Navy, Airforce, Satellite Launch Vehicles, and commercial batteries for Auto and Standby VRLA applications. The Company also exports products to various countries. The Company was established in 1979.

• Revenue: Rs 65.13 Cr
• Market Cap: 53.19 Cr.
• ROE: 2.39 %
• Sales Growth (3Yrs): 26.98 %
• Promoter holding: 40.97 %
• Debt to equity: 1.86
• Price to book value: 2.41

The Company has a strong base of in-house Research and Development Wing to design, develop and establish manufacturing of batteries – Silver Oxide Zinc, Nickel Cadmium, Silver Chloride Magnesium for stringent applications such as Underwater propulsion, Control guidance, Communication, Emergency starting and for Aerospace applications.

3. PANASONIC ENERGY INDIA COMPANY Ltd: -

Panasonic Energy India Co. Ltd., established in the year 1972 as Lakhanpal National Limited, is one of India’s largest manufacturers & suppliers of dry cell batteries and lighting products.

Headquartered in Vadodara (Gujarat), the Company is a part of global Panasonic Corporation, the world’s leading manufacturer of audio-visual equipment, home appliances, electronic components, automotive electronics, and environmental systems.

• Revenue: Rs 201.87 Cr
• Market Cap: 128.89 Cr.
• ROE: 4.89 %
• Sales Growth (3Yrs): -4.92 %
• Promoter holding: 58.06 %
• Debt to equity: 0.00
• Price to book value: 1.28

The Company is a leading manufacturer and supplier of Zinc carbon, Alkaline, Lithium, Rechargeable batteries, and lighting products.

Company has an established and wide sales network that includes 2 manufacturing units, state of the art technology, distribution centers, numerous stocks, and thousands of retailers across India.

The Company is a pioneer in Metal Jacketed Dry battery, high-performance pencil battery, Zinc-Chloride technology, and eco-friendly batteries in India.

 4. INDO NATIONAL Ltd.:-

A name synonymous with batteries, manufactured by Indo National Limited. Since its inception in 1972, Nippo has been providing millions of its customers with a quality and performance that is second to none. Nippo also markets a variety of LED torch lights to cater to customer requirements. Nippo recently launched LED Emergency Power Backup range products.

• Revenue: Rs 493.18 Cr
• Market Cap: 191.59 Cr.
• ROE: 9.40 %
• Sales Growth (3Yrs): 0.23 %
• Promoter holding: 65.35 %
• Debt to equity: 0.21
• Price to book value: 0.91

Indo National Limited with its corporate office at Chennai is the first Indian dry battery company to have been certified with ISO 9001 and ISO 14001 international standards and has the ISI mark of quality on all its batteries. Nippo has 35 depots across India and has an excellent distribution network with over 4000 stockists pan India.

 5. EVEREADY INDUSTRIES INDIA Ltd:-

The company is an undisputed market leader in the batteries segment, commanding over 50% of India’s market share, and holding 75% of India’s organized flashlights market.

• Revenue: Rs 1,419 Cr
• Market Cap: 462.97 Cr.
• ROE: 16.95 %
• Sales Growth (3Yrs): 4.41 %
• Promoter holding: 27.40 %
• Debt to equity: 0.91
• Price to book value: 1.15

The Eveready journey started in India in 1905 while the company got incorporated in 1934 and became a part of the Williamson Magor Group in 1993. Throughout, the company has maintained a focus on deepening penetration into existing markets, foraying into new markets, and catering to evolving customer requirements by increasing efficiency of existing products and adding new products to the product portfolio.

 6. AMARA RAJA BATTERIES Ltd.:-

Amara Raja Batteries Limited (ARBL) is the technology leader and one of the largest manufacturers of lead-acid batteries for both industrial and automotive applications in the Indian storage battery industry.

The Company is a leading manufacturer of automotive batteries and home UPS/Inverter batteries under the brands

• Amaron® and
• PowerZoneTM, which are distributed through the pan-India sales & service retail network.

ARBL supplies automotive batteries under OE relationships to Ford India, Honda, Hyundai, Mahindra & Mahindra, Maruti Suzuki, Ashok Leyland, and Tata Motors, Honda Motorcycles & Scooters India Private Ltd, Royal Enfield, Bajaj Auto Ltd, among others. ARBL is also the leading private label supplier for prominent brands.

• Revenue: Rs 6,825 Cr
• Market Cap: 13,428 Cr.
• ROE: 15.38 %
• sales Growth (3Yrs): 13.73 %
• Promoter holding: 28.06 %
• Debt to equity: 0.02
• Price to book value: 3.74

In India, ARBL is the preferred supplier to major telecom service providers, telecom equipment manufacturers, the UPS sector (OEM & Replacement), Indian Railways and to the Power, Oil & Gas, Motive among other industry segments. Amara Raja’s Industrial Battery Division comprises brands such as PowerStack®, Amaron VoltTM, Amaron SleekTM, Amaron VoltTM Amaron BruteTM, and Amaron Quanta®.

7. EXIDE INDUSTRIES Ltd:-

EIL today is India’s largest storage battery company with the widest range of both conventional flooded as well as the latest VRLA batteries. Apart from serving the domestic market the company exports batteries which have captured niches in South East Asian and European markets.

• Revenue: Rs 15,258 Cr
• Market Cap: 15,474 Cr.
• ROE: 13.39 %
• Sales Growth (3Yrs): 15.81 %
• Promoter holding: 45.99 %
• Debt to equity: 0.03
• Price to book value: 2.38

Exide designs, manufactures, markets, and sells the widest range of lead-acid storage batteries in the world from 2.5Ah to 20,600Ah capacity, to cover the broadest spectrum of applications. Using the latest technological inputs, the company manufactures batteries for the automotive, power, telecom, infrastructure projects, computer industries, as well as the railways, mining, and defense sectors.

Apart from this there are several companies which are focused mainly on lithium ion battery production.

List of Lithium-ion Battery Manufacturers Stocks in India

1. BHEL and ISRO:-

•  Bharat Heavy Electricals Ltd (NSE: BHEL) reached an MOU with the Indian Space and Research Organization (ISRO).

•  BHEL is going to invest Rs 100 crore.

2. EXIDE INDUSTRIES:-

•  Exide Industries and Sydney-based Ecoult are setting up a new lithium-ion battery manufacturing plant in East India named Ultra Battery.

•  Exide Industries, India’s largest manufacturer of batteries, and Leclanché announce the launch of a new joint venture to build lithium-ion batteries and energy storage solutions to power the growth of India’s electric vehicle market.

3. AMARA RAJA BATTERIES:-

•  The Hyderabad-based company Amara Raja Batteries is ready to enter the electric car batteries space.

•  The company is aiming to be an Rs 10,000-crore entity in the next 2-3 years as the company clocks a solid double-digit growth.

•  The company is registering a CAGR (compound annual growth rate) of around 14- 15 percent in its revenue over the past five years.

•   Amara Raja Batteries Ltd (NS:AMAR)India's second-biggest traditional battery maker by value, will build a lithium-ion assembly plant as it seeks to grab a slice of the market for electric vehicle power packs that are set to grow to $300 billion by 2030.

4. HBL POWER SYSTEM:-

• It is a leading battery and power systems company based in Hyderabad, India.
• The company makes batteries for the defense and industrial sectors.

5. HIGH ENEGRY BATTERIES:-

•   High Energy Batteries Limited is an India company that manufactures batteries. The company has a market cap of $609.54 million.

•   The Firm operates through two divisions: Aerospace, Naval, and Power System Batteries, and Lead Acid Storage Batteries.

Figure 2- Market capitals

Figure 3-Stock price of various manufacturers

Figure 4- Revenue of various manufacturers

Figure 5-Net profit of various manufacturers

By comparing the stock prices of all the companies, we can find that major increase in stock price is found in AMAR RAJA Batteries in the next decade, and according to net profit and revenue graphs AMARA RAJA Batteries have the growth in terms of net profit and revenue and market capitals. Also EXIDE batteries and High energy batteries shows considerable increment in revenue and net profit.

Future Scope:-

There is no doubt that in future Battery manufacturing companies will prosper and there are several reasons like battery itself gets expired after several years depending on its capacity, so demand is never going to reduce but major scoping factor is increasing use of electric vehicles and it’s not only becoming good option to combustion vehicle but it is today's need to switch to electric because limited supply of Non-renewable fuel which are going out of stock in future for sure. And hence governments also promote the use and manufacture of electric vehicles which is favorable to battery industries in India.

The share of renewable energy in the global energy system is increasing rapidly, electricity storage will grow in tandem as EVs decarbonize the transport sector, and solar power is deployed at an increasing scale. simultaneously, falling battery costs will open new economic opportunities for storage technologies to provide various grid and mobility services and boost the economic value of using distributed batteries to increase the self-consumption.

Figure 6-Annual Lithium Ion Battery Demand

According to a global study, a decrease of battery cost is anticipated by 2025, which will determine a significant decrease in the acquisition price of the electric vehicles, helping them reach closer to the price of petrol or diesel vehicles. Another study also revealed that the cost of Li-ion batteries decreased by over 50% from 2007 until 2014, globally, so the process is already underway.

In India, the cost of the battery has dropped significantly — in 2010, it was about $1000 per kWh, while this fell to over $200 per kWh by 2018, an 80% drop. With the prices of batteries coming down, electric mobility and battery storage will be the next big opportunity for entrepreneurs and investors in the country.

Figure 7-Long term Electric Vehicle sales projection 

And major aspect of it are like,

•        The Government of India is fully dedicated to make India a 30% EV nation by 2030 that led to a sharp rally in the stock of companies with exposure to EVs.

•        Electric vehicles (Cars, Buses) will be the future of our country because very soon the running cost of the vehicle could be around 20 to 30 paise per km and can attain a speed of 40-50 km per hour.

•        Its cost will be so much less that people will soon shift from petrol/diesel vehicles to electric vehicles.

•        The most important thing is that the Electric Vehicles could create a $300 Billion Domestic Battery Market by 2030.

•        One more thing to notice is that the government had launched the FAME INDIA scheme in 2015 offering incentives on electric and hybrid vehicles of up to Rs 29,000 for bikes and Rs 1.38 lakh for cars.

•        The NDA 2.0 government in Budget 2019 lowered the GST rate on electric vehicles (EV) from 12% to 5%.

•        In addition, there will be an Income Tax Deduction of Rs. 1.5 lakh on the interest paid on the loans taken to purchase electric vehicles.

•        So, if you want a 30-40% compound annual growth rate (CAGR) then you must consider this sector and must add electric Vehicles stocks into your portfolio.

Government has also brought up some schemes and subsidies to promote growth in battery manufacturing industries in India as well as to attract foreign companies to invest in India.

The government is working on a direct subsidy plan of about Rs 700 crores which will aim to attract Indian as well as foreign firms to play a part in domestic manufacturing of batteries. Benefits such as a 10-year subsidy (applicable on evolving technology as well) and zero import duty (Lithium, Iron, Cobalt-based EV Batteries) are also on the table.

                                                           - By Saur News Bureau/ Updated on Tue, Aug 6th, 2019On Tue. The Government plans to offer $4.6 billion in incentives to companies setting up advanced battery manufacturing facilities as it seeks to promote the use of electric vehicles and cut down its dependency on oil, according to a government proposal seen by Reuters.

    -By Reuters / Updated on Sep 26, 2020, 08:28 IST

Companies are accelerating plans to produce lithium-ion cells in the country, hoping to take advantage of ₹18,000 crore worth of government subsidies announced last month, two people directly aware of the developments said. The production-linked incentive (PLI) scheme announced by the Union government could spur these companies to start local manufacturing of lithium-ion cells in the next couple of years.

-The Mint / Updated: 01 Dec 2020, 07:33 AM IST

 

Challenges:-

Various battery technologies have been developed at the global level, suitable for both stationary applications and transportation markets. It is observed that lithium-ion batteries have high power and energy density, along with competitive cycle and calendar life, which justifies their use and consideration for a wide variety of applications spanning from electric mobility to off-grid application.

India is somehow not the first destination for foreign companies to invest in Asia; and hence India should focus on attracting foreign investment.

 Some major challenges are listed below

1.  Demand risk

2.  Low mineral reserves

3.  Cost of battery technologies

4.  Lack of cost-effective cell manufacturing know how

5.  Early stage battery manufacturing industry

6.  Maintenance requirements and performance of battery system

7.  Improving power availability scenarios

8.  Lack of coordination among stakeholders

9.  High technology risk

10.  Recycling for material recovery and second use life

Conclusion:-

In this blog we have come to know about battery manufacturing as well as the distribution process in Battery manufacturing companies in India. And also, analyze the major players in this domain and the increasing importance of electric vehicles (lithium ion batteries) which will lead to create many opportunities in this sector in India as well as the current scenario of market values of battery companies.

We have also discussed future opportunities in the battery manufacturing sector in India and also how the government is planning on attracting more investment in this sector either through subsidies or other policies and also listed the challenges ahead of this industry which will need attention.

We have also discussed the Net profit, Revenue and Stock of many manufacturing companies which gives clear idea about current market scenario. Net profit and revenue specifies idea about their ongoing states. And from the information which we get from the Stock graph we can predict how the company’s stock performs and invests accordingly.

Stock price forecasts are predicted by Deep Learning processes by technical analysis, shouldn't been used for investment decision.

Author-

• Vishwajeet Desai.
• Ashish Mali.
• Kaustubh Patil.
• Nivedita Deshmukh.
• Harshad Nawale.

 Guided By-

          Prof. Dr. Sunil Shinde.