Amber Enterprises Gets PL Capital's 'Buy' Rating As It Initiates Coverage — Check Target Price

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PL Capital Report

We initiate coverage on Amber Enterprises India Pvt. Ltd. with ‘Buy’ rating and SOTP-based target price of Rs 9,782 valuing its consumer durables segment at 25x EV/Ebitda Sep-27E, which implies 24x EV/Ebitda Sep’27E and 50x Sep’27E earnings.

We believe Amber Enterprises is poised for healthy long-term growth on the back of-

1. diversification of the consumer durables segment beyond room air conditioners (RACs),

2. improved capacity utilization and broader product offerings across segments,

3. capacity expansion, entry into the fast-growing PCB market, and a strong order book of Rs 50 billion in the electronics segment,

4. revival in the Mobility segment, backed by a robust Rs 20 billion order book, product diversification, and execution of delayed projects, and

5. market leadership in RAC contract manufacturing.

We estimate revenue/Ebitda/PAT CAGR of 22.8%/27.9%/49.6% over FY25-27E with Ebitda margin expanding by ~65 bps to reach 8.3% by FY27E.

Despite a strong capex plan, robust financials are expected to help maintain RoCE/RoE at healthy levels, 18.3%/19.3% by FY27E. Initiate ‘Buy’.

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