Amber Enterprises Posts Strong Q1 Despite Sluggish RAC Industry, Says Dolat Capital Maintaining 'Add'
Dolat Capital maintains ‘Accumulate’ rating with target price of Rs 8,666, valuing at 50x FY27E EPS.
Amber Enterprises' revenue surged 43.6% YoY to Rs 34.5 billion. Ebitda margin contracted 80 bps to 7.4% as 210 bps increase in raw material costs was partially offset by 60/70bps decrease in staff/other costs resp. Ebitda stood at Rs 2,567 million, an increase of 30.9% YoY. PAT came in at Rs 1,039 million up 43.6% YoY.
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Dolat Capital Report
Amber Enterprises India Pvt. Ltd. exhibited revenue growth of 44% YoY in Q1, driven by robust 35/97/29% YoY growth in the consumer durables/ electronics/ railway subsystems and Mobility divisions resp. Ebitda margins fell 80 bps to 7.4% mainly due to unfavorable business mix.
However, mgmt. has guided for 8-9% consolidated Ebitda margins for FY26E.
Backed by a healthy order book and addition of high margin accretive application, the Electronics division is expected to register a topline of USD 1bn in the next three years, with Ebitdam of ~11.5-12%.
Management is confident of outpacing the CD division growth by ~10-15% in FY26. We have increased our FY26/27E EPS by 8/9% to Rs 124/172. Maintain ‘Accumulate’ rating with target price of Rs 8,666, valuing at 50x FY27E EPS.
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