Buy Amber Enterprises; target of Rs 9000: Motilal Oswal

Motilal Oswal's research report on Amber Enterprises

Amber Enterprises (AMBER) posted better-than-expected performance in 1QFY26. Revenue outperformance was driven by continued strong growth in consumer durables—particularly in RAC, despite weak demand faced by RAC players in 1QFY26— as well as sustained growth in the electronics division. AMBER is continuously increasing the share of components in RAC, adding more clients across the AC and overall consumer durables divisions, and focusing on increasing wallet share with clients. This, we believe, will offer sustainable growth in the consumer durable division, despite seasonality in RAC demand. With increased capex, acquisitions in niche electronics areas, and diversification across new segments in electronics, we expect strong growth in the electronics segment to continue. This momentum is expected to be further supported by the commissioning of the company’s capacity in JV with Korea Circuit. We expect the railway segment’s performance to remain subdued in the near term. We increase our estimates by 10%/12% each for FY26/27 to factor in 1QFY26 performance. Reiterate BUY with a revised TP of INR8,950 (INR7,700 earlier).

Outlook

The stock currently trades at 69.1x/44.3x/30.6x P/E on FY26/27E/28E earnings. We increase our estimates and reiterate our BUY rating on the stock with a DCF-based TP of INR9,000 (earlier INR7,700).