Amara Raja to Begin Lithium-Ion Cell Production by 2027

India's lithium-ion cell manufacturing base is gradually taking shape, but electric vehicle manufacturers should not count on an early reduction in battery costs, according to a senior executive at Amara Raja Energy & Mobility. Vikram Gourineni, executive director at the company, was quoted as saying by ETAuto that domestically produced cells would carry a price premium of at least 15 per cent over imported equivalents in the near term. He attributed this to the time required to build a meaningful upstream supply chain -- from raw materials through to components -- of the kind China took roughly two decades to assemble. 

Until Indian cell makers reach a combined scale of 8 to 10 GWh and a supporting supplier ecosystem develops around them, the economics would not favour EV manufacturers, he said.

Amara Raja is aiming to begin bulk lithium-ion cell production in 2027, which would make it the second domestic manufacturer to reach that milestone after Ola Electric. "We're aiming for the end of next year for bulk production to start," Gourineni said. "I always give myself a little leeway of a quarter or two, but that's the target."

The company intends to scale up in stages. Cell output will begin this year at a megawatt-hour level, with commercial samples made available to Indian customers for qualification purposes. Full-scale production at its first gigafactory, with an initial capacity of 2 GWh, is planned for 2027 and will be directed primarily at the electric two-wheeler market. To avoid over-dependence on a single segment, Amara Raja also plans to supply cells into adjacent categories including power tools and lawn and garden equipment.

Tata Group's battery venture Agratas, which is establishing a facility in Gujarat, is also expected to come to market within a similar window.

Amara Raja has set aside ₹10,000 crore in capital expenditure through to 2032 to develop its lithium cell and pack manufacturing operations. The company had originally planned for 16 GWh of total capacity but now sees scope to exceed that figure given robust demand growth, though raw material access and technology availability remain potential constraints.

The announcements follow a recent operational milestone for the company, having cumulatively deployed 1 GWh of lithium energy storage across 50,000 telecom sites nationwide.