The country’s largest automotive battery maker, Exide Industries Ltd, has forayed into the manufacture of e-rickshaws. The new vertical, which the company launched on October 16, is likely to add nearly Rs 120 crore to its topline in FY2020-21, the first full year of sales.E-rickshaws will be sold under the brand ‘Exide Neo’ and across markets such as West Bengal, Uttar Pradesh, the North East states and the National Capital Region.
According to Gautam Chatterjee, managing director and CEO, Exide Industries, this is the first forward integration project that the company has taken up in recent times. An assembly line with an annual capacity of 15,000 units has come up at Dankuni (Hooghly), some 20 km from Kolkata. While most of the components — apart from battery (which is 40 per cent the cost for an e-rickshaw at a factory level) — are sourced from China, plans are afoot to increase indigenisation.
At present, the e-rickshaws made by Exide have 15-20% component indigenisation. “The e-rickshaw sector has seen phenomenal growth in the country over the past few years. We have been an integral part of it since its inception through our offerings of lead-acid batteries. It is a calculated risk that we are taking in the hope that there will be more demand in the coming days,” said Chatterjee, adding that foraying into the segment will not give “any significant revenue” but it will provide a forward integration for the battery maker.
Incidentally, the Rs 10,500-crore Exide was amongst the first branded automotive battery makers to have products exclusively for the e-rickshaw sector. The batteries are being produced at Haldia. “We are targeting 10,000 unit sales in the first year of operations. That should lead to an addition of Rs 120 crore to our top-line,” said Arun Mittal, Director Automotive, Exide Industries.
“We will also introduce lithium-ion battery-powered e- rickshaw but that would be done in a leasing model over the next six months,” added Chatterjee. The company has formed a 75:25 joint venture with Swiss firm Leclanche and has already invested around Rs 100 crore, with another Rs 100 crore expected by the end of March 2020. Chatterjee maintained that lithium-ion batteries are costly and plans are also on to introduce a leasing or financing model for customers.