Exide shares zoom nearly 15% after pact with Hyundai, Kia for EV battery localisation
Upstox
2 min read • Updated: April 8, 2024, 1:03 PM
Summary
Hyundai Motor and its group company Kia Corporation have signed an MoU with Exide Energy, an arm of the listed Exide Industries, for the local manufacturing of EV batteries. This led to a sharp spurt in the share prices of Exide, with the company hitting the upper circuit.
The shares of Exide Industries rallied by nearly 15% during intraday trade on Monday, after it was announced that Hyundai Motor and Kia Corporation have sealed an agreement with its wholly-owned arm for electric vehicle (EV) battery localisation.
At 12:42 pm, the shares of Exide Industries were trading at ₹370.1 apiece on the National Stock Exchange (NSE), up 14.9% as against the previous day’s close. Earlier, the stock was temporarily freezed from trading after the 10% upper circuit was reached.
Here’s why Exide Industries shares are rising
Hyundai and Kia have signed the memorandum of understanding with Exide Energy Solutions, which is a wholly-owned subsidiary of the Kolkata-based Exide Industries.
Through the pact, Hyundai and Kia aim to localise the production of their EV batteries, specifically those involving the use of lithium-iron-phosphate (LFP) cells, a statement noted.
The agreement is in line with the expansion of their EV plans for the Indian market, it added.
"This strategic move will position them as the pioneers in applying domestically produced batteries in their upcoming EV models in the Indian market," the statement said.
The sale of EVs in the Indian market is estimated to grow by 66% in 2024, and nearly one-third of all passenger vehicles sold in India by 2030 will be electric, as per a recent report released by Counterpoint Research.
Heui Won Yang, President and Head of Hyundai Motor and Kia's R&D Division, said India is a key EV market for the company, and it plans to gain strategically through the battery localisation pact.
"Through this global partnership with Exide Energy Solutions Ltd, we will gain a competitive advantage by equipping Hyundai Motor and Kia's future EV models in the Indian market with locally produced batteries," he said.