BUY Amber Enterprises; target of Rs 8,600: Kotak Neo Research
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Amber Enterprises has retained a BUY call with a fair value of Rs 8,600, as stronger-than-expected Q1FY27 profitability and the company's upcoming Oppo mobile manufacturing tie-up keep the long-term growth outlook intact.
Kotak Neo Research recommended a BUY rating on Amber Enterprises with a DCF-based fair value of Rs 8,600 in its research report dated 17 August 2026. Against the current market price of Rs 7,222, the fair value implies meaningful upside from current levels.
Amber Enterprises' Q1FY27 EBITDA came in slightly ahead of estimates, with operating profitability stronger than expected. The EBITDA margin stood at 8.0%, 100 basis points above estimates. Revenues, however, were 10% lower than estimates, driven by weakness in the consumer durables and electronics segments.
Within consumer durables, weak execution during the quarter was offset by better profitability. FY27 growth guidance for the segment has been retained in line with the Room Air Conditioner industry, in the 13-15% range. The electronics segment continues to see a strong growth outlook, though PCB margins remain a near-term drag; FY27 revenue growth guidance of 40%+ for the segment has been reiterated, driven by all three verticals within it.
On the negative side, the railway subsystem and defence business saw operating EBITDA decline 26% year-on-year during the quarter.
Looking ahead, the firm expects the company's mobile foray with Oppo to offer strong medium-term optionality, with ramp-up expected from FY28. It expects overall revenues to see a 45% CAGR over FY26-29E, driven by stable growth in consumer durables (15% CAGR) and high growth in electronics (93% CAGR). Recovery of PCB margins from 12% to around 15% in the second half of FY27, along with the timely commissioning of Ascent's new Hosur facility, remain key monitorables. Kotak Neo has retained its BUY rating with a revised fair value of Rs 8,600, valuing the stock at the same 13x EV of March 2028E EBITDA.
Amber's Mobile Manufacturing Foray
Separately, during the company's earnings call, Amber Enterprises Executive Chairman, CEO and Whole-time Director Jasbir Singh said the company expects to begin manufacturing Chinese smartphone brands, Oppo, OnePlus and Realme, from the March 2027 quarter, with plans to double output in the second year of operations. Singh said the company expects to start with around 8 million units in the first year, scaling to around 16 million units in the second year. He said the foray is being carried out through a manufacturing collaboration agreement with Oppo Mobiles India, and that trial production is on course to begin in the fourth quarter of FY27, with commercial production starting in the first quarter of FY28.
Singh also addressed rising input costs, saying the company has been passing on cost increases to clients with some lag, and that Copper Clad Laminate prices are expected to keep rising due to demand from artificial intelligence and data centre applications, amid a shortage of the material. The company expects to set up its own CCL plant by 2029-30, he said.
At the time of writing, shares of Amber Enterprises were trading at Rs 7,299, up 1.07% on Monday, August 17. The stock had touched an intraday high of Rs 7,394 and a low of Rs 7,246.50 during the session.
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This article is for informational purposes only and should not be considered investment advice from Kotak Neo. For compliance T&C and disclaimers, Visit www.kotakneo.com/disclaimer
Rochelle Britto is a business journalist with 8+ years of experience in financial journalism. She covers equity markets, corporate earnings, IPOs, commodities and the economy.
As a reporter with leading business publications, she has tracked financial markets and covered sectors including banking and financial services, retail, consumer goods, advertising and e-commerce.
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