“Lead-acid Batteries are here to stay”, Ahila Krishnamoorthy, Daramic

Highlights :

“Despite a switch in technology from regular to EVs there will still be a demand for lead acid batteries.”

“My understanding is that with a lot of uncertainties, it is difficult to predict whether PLI alone is sufficient to accelerate this (cell manufacturing) in India.”  


“Lead-acid Batteries are here to stay”, Ahila Krishnamoorthy, Daramic

Despite the increasing build up around lithium-ion batteries, which are poised to become the next big thing in battery storage space, demand for lead-acid batteries continues to grow steadily, if not spectacularly. The 90 year old US firm Daramic is at the centre of this transition, with a big stake in the sector. With its India operations since 2008 where it has two manufacturing plants, the firm is a familiar player to stakeholders in the battery space. It is the largest manufacturer of Polyethylene (PE) separators but also the only manufacturer of phenolic resin-based separators for automotive, industrial and specialty applications in the lead-acid battery industry.

Expressing her confidence in the continued growth of lead-acid batteries in India, Ahila Krishnamoorthy, MD, Daramic India speaks to Saur Energy about its scope and potential. She also talks how the company is exploring the lithium-ion battery space as well. 

Q.1 Industry is betting big on lithium-ion batteries. While Daramic is into lead acid battery separators, do you have plans for exploring the li-ion battery space?

Ahila Krishnamoorthy

Ahila Krishnamoorthy, MD, Daramic India

There are estimates which foresee India’s market size for lithium-ion to be around 50 GHz by 2025. However, there are a lot of factors that will enable this. There are things like – availability of raw materials in India, ability to manufacture lithium-ion (li-ion) cells, infrastructure for charging the batteries, huge investments to manufacture batteries in India among others – are required to facilitate this. While this is achievable with various initiatives from the government and support from private investors, lead acid battery is not going away.

Daramic is primarily in lead acid batteries, but in lithium-ion batteries we do have extensive technology developed in other countries. The lead acid batteries, even in the electric cars, provide power for starting of the engine, lighting, ignition as well as power to auxiliary units like radio, music, VCD, DVD players.

Despite a switch in technology from regular to EVs there will still be a demand for lead acid batteries. We don’t see this demand slowing down for us. Perhaps, we may see different specification requirements coming up. But this also, we will meet through separators, while battery manufacturers also, will find ways to meet the demand. Lead acid batteries are here to stay.

Having said that, we through Daramic’s sister company Celgaurd, which manufacturers lithium-ion battery separators, have a strong presence in this space as well. Separator as you know is an important component in the Li-ion batteries. When, and if there is unexpected growth in India, we can meet the needs of li-ion separators and look at setting up a plant later in India. Currently, we are just watching and studying the emerging market.

Q.2 As per your estimates, what is the market like for Li-ion batteries as against the lead acid batteries? Which cities and states are fueling demand?

So far in India, it is not much, not very significant to be mentioned. However, developments are going on in different parts of India to assemble batteries from imported cells. Every country started like this. Other countries with developed li-ion space went through a similar transition. They did not develop li-ion battery space overnight. It has taken 20 years of research into li-ion batteries. So, for instance, if we talk about US, they started working on li-ion battery technology almost 20 years back, before any battery production started in the US. Once the production started in US, then China went after the US companies, acquired them. The whole sector started opening up, more jobs, technology transfer among other things started happening. Therefore, we are on the right path. Demand also needs to be created. For example, Electric vehicles cost more than fuel powered ones.  The affordability of the population is not very high.  Some may move to EVs but switching completely to EV is an idea, which is little farfetched. Supply chain is not developed yet. It is an ongoing process. We are only assembling here in India right now. I see around 5 – 10 years to make this happen.

Q.3 But for the long terms, are you looking at firming up plans to move into this space?

We are at the moment, making lead acid battery separators and selling to Exide, Amararaja and so on. Our competence and capabilities can be easily switched to cater to li-ion battery when we decide to put a factory in India.

Within Asahi Kasei, our parent organization, we are discussing about how to contribute and accelerate this development in India. We are assessing the market to invest in first importing separators into the country, and later on, to start a greenfield project to manufacture separators in India.

Q.4 Talking of production in India, what change do you expect the PLI scheme to bring about as far as cell manufacturing goes?  

It is a good initiative. It will help the companies that are announcing to start production in India. However, we are today importing li-ion cells from other countries and assembling into batteries. As per the government initiative, under PLI one can access benefits once we are producing here. So, basically, we must produce and sell here to be able benefit from it. So, it is not an incentive to start a factory.

That would be the biggest incentive required. While private investors are also looking to invest in India, but that too will not happen immediately. So, my understanding is that with a lot of uncertainties, it is difficult to predict whether PLI alone is sufficient to accelerate this in India.

Q.5 What are some of the key challenges as far as policy regulations go?

I hope that the concerned authorities are looking at all aspects to improve the ease of doing business in India. I am particularly impressed with Gujarat. The State gave us lots of incentives, there is also ease of doing business in the State. I would definitely like other States also to follow the Gujarat model.

Q.6 What are going to be the broad trends in storage space?

Energy storage (large capacities) – such ESS – needed for country like India where population growth does not show any slowing down and the people’s energy needs are increasing. Rural areas are becoming electrified creating more dependence on grid supplies, which when fails, we need inverters at home and offices. This space will remain as long as electric demand supply equation is off balance.

Q.7 Last month, you have doubled your production at the Gujarat factory? What are the future plans now?

Today, what we are producing is sufficient for the needs of the Indian battery manufacturers but with the doubling of production, we want to convert from being importer to being completely local provider, able to meet the demand. Battery manufacturers have faced many logistical delays. So, with our expansion we are targeting players who are currently importing. We can meet the demand. The lead acid battery industry is around a 3 bn dollar market, so about 3-5% of total cost is on separators, and we are a major supplier there. We have a market cap of more than 50% share. Indian battery manufacturers don’t need to go anywhere else. They can come to us for all their separator requirements. Our expansion can support the entire battery business in India.

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