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Nirmal Bang Report
While topline was below our estimate by 21.4% due to lower-than-expected consumer durable sales, Ebitda margin was above our estimate by 113 bps due to higherthan-expected expansion in the room AC component business.
Amber's market share in RAC manufacturing stood at 27.3% in FY24. Amber is consciously moving away from RAC finished goods (72% revenue contribution in FY18 to 40% in FY24) to RAC and non-RAC components.
Electronics (~18% of revenue contribution in FY24) and railway subsystems and mobility – RSM (~7%) segments are expected to be the main growth levers going forward (Amber's 2.0 and 3.0 growth story).
We maintain Accumulate with a revised target price of Rs 3,805, valuing it at 33 times Mar'26E earnings per share. Rising share of high-margin businesses such as RAC and NonRAC components, defence, consistent increase in wallet share and significant contribution from high growth divisions like electronics and mobility bode well for return ratios in the medium to long term.
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