Amber Enterprises shares higher by 12% ahead of quarterly results, street expects a return to profit

Amber Enterprises posted solid gains of 89 percent in the last year.

Shares of Amber Enterprises rallied as much as 12 percent to Rs 7,029 on January 23, snapping a two-day losing streak on the bourses ahead of its third quarter earnings later today.

The electronic devices manufacturer is expected to swing back to profitability in the ongoing quarter, reversing the net loss reported during the same period last year.

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Amber is likely to post a net profit of Rs 23 crore, a CNBC-TV18 poll reported, compared to a net loss of Rs 50 lakh a quarter ago. Revenue is projected to rise 33 percent on-year to Rs 1,722 crore, while EBITDA is expected to jump 53 percent to Rs 120 crore.

EBITDA margins are forecasted to improve by 90 basis points to 6.9 percent, driven by contributions from the Ascent acquisition, an improved product mix, and stable raw material costs.

The EMS segment is anticipated to remain the primary growth driver for Amber’s topline, while its Sidwal business, acquired in 2020, is expected to report flat performance.

With a robust festive season and summer ahead, the market remains bullish on the company’s RAC business.

Key focus areas for management commentary will include new client additions, the outlook for standalone and subsidiary operations, demand trends, and margin growth in the non-RAC, electronics, and railways segments.

Last month, CNBC TV-18 reported citing people familiar with the development that the company was considering a demerger of its electronics division. The company may also explore an IPO for the electronics division once the demerger process is complete, and bankers have been appointed to oversee the demerger and the potential IPO, said the report.

In financial year 2024, the electronics division contributed 20 percent to Amber Enterprises' total revenue.

At about 10:51 am, shares of the company were trading at Rs 6,941, higher by 10.4 percent from the last close on the NSE. Amber Enterprises posted solid gains of 89 percent in the last year.

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