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Amara Raja Shares Rally 20% After Signing Agreement With China's Gotion

Published 25-06-2024, 10:28 am
Amara Raja Shares Rally 20% After Signing Agreement With China\'s Gotion

Benzinga - Shares of Amara Raja Energy and Mobility rose 20% in Tuesday morning session after the company signed a deal with Gotion's subsidiary to create lithium-ion batteries.

What Happened: Amara Raja said it signed a technical licensing agreement with GIB EnergyX Slovakia s.r.o., a subsidiary of Gotion High-Tech Co. GIB Energy will license Gotion's lithium iron phosphate battery (LFP) for lithium-ion cells to Amara Raja.

Through the licensing, Amara Raja will get access to cell technology IP, support in establishing gigafactory facilities for the latest generation process techniques, and integration with Gotion's global supply chain network for critical battery materials and customer technical support for solution deployment, the company said in a regulatory filing.

Brokerage Views: JP Morgan maintained its "neutral" stance on the company with a target ₹1,210. The research firm said in its note that the technical licensing agreement with Gotion is a step in the right direction. The partnership will provide investors with more confidence in the company. It will also drive confidence in the company's ability to progress towards the 16 Gigawatt hours (GWh) capacity target.

The brokerage added that potential original equipment manufacturing contracts, any equity/debt funding and further details of the tech partnership are key for further re-rating.

Price Action: Shares of Amara Raja Energy and Mobility rose 17.05% to ₹1,615.40 on Tuesday morning. The stock went up over 20% to a hit a new record high of ₹1,656.05.

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Read the original article on Benzinga

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