Amara Raja could face growth, margin pressures

While price hikes will partly offset higher lead costs, growth worries may impact revenues

The Amara Raja stock hit a 52-week low on Thursday as higher lead prices, expensive valuations and higher exposure to the telecom segment weighed on the scrip. Lead prices on the London Metal Exchange, which had risen 28 per cent year-on-year to $2,149 per tonne in the December 2016 quarter, are up about 12 per cent since the start of 2017. Lead prices are currently trading at $2,227 per tonne. The rise in lead prices is attributed to mine shutdowns. Given that lead accounts for 60 per cent of the raw material costs, it will have a bearing on the