Amber Enterprises target price cut at JM Financial; check outlook, target

JM Financial cut its earnings per share estimates for the FY25-26 to FY27-28 period by 3-5 per cent to account for higher minority interest and lower revenue assumptions for FY27-28

Analysts at FM Financial cut their target price for Amber Enterprises Ltd. and lowered earnings estimates, citing weaker revenue prospects in the coming financial years.

 

The domestic brokerage said its interaction with the management of Amber Enterprises indicates that the Indian room air conditioner (RAC) industry could see a marginal contraction or remain flat in the 2026 fiscal year due to the extended monsoon and a harsh winter. 

 

Despite this, Amber expects to outperform the industry, supported by its second-half order book, and deliver 10-15 per cent year-on-year (Y-o-Y) growth in the RAC segment. Over a three-year horizon, management guided for a 17-18 per cent compound annual growth rate (CAGR) in the consumer durables vertical.

 

 

In electronics, the company targets revenue of $1 billion by FY28-29 and aims to scale margins to double digits by FY26-27, aided by a favourable shift in core printed circuit board assembly mix and contributions from recent acquisitions. JM Financial remains conservative on margins, factoring in 9.7 per cent by the 2027-28 fiscal year.

 

JM Financial cut its earnings per share estimates for the FY25-26 to FY27-28 period by 3-5 per cent to account for higher minority interest and lower revenue assumptions for the FY27-28. It maintained an 'Add' rating with a target price of ₹7,750, revised down from ₹8,150. 

 

The brokerage highlighted the completion of three acquisitions: a 60 per cent stake in Power-One Microsystems, expected to contribute ₹270-280 crore to revenue in the FY25-26 with margins of 17–18 per cent; a 40.2 per cent stake in Unitronics, where margins could be around 20-25 per cent but revenue scaling may take 15–18 months due to geopolitical challenges in Israel; and an 80 per cent stake in Shogini Technoarts, where margins are expected to be around 16 per cent, although growth may trail other businesses within the vertical.

 

Earlier this week, Nuvama Institutional Equities and Motilal Oswal Financial Services reiterated their 'Buy' rating on Amber Enterprises. Nuvama maintained its target price at ₹9,100, and Motilal Oswal adjusted its target downwards to ₹8,000 from ₹8,400. 

 

In Q2FY26, Amber delivered flattish revenue of ₹1,647 crore, and operating earnings before interest, tax, depreciation and amortisation (Ebitda) of ₹98 crore, reflecting a decline of 19 per cent Y-o-Y. Ebitda margins declined by 128 bps Y-o-Y and 190 bps quarter-on-quarter (Q-o-Q) at 5.5 per cent due to subdued revenue contribution and operational deleverage. 

Amber Enterprises share price movement

Shares of Amber Enterprises have fallen 10.5 per cent this year, compared to a 9.2 per cent advance in the benchmark Nifty 50. Amber Enterprises has a total market capitalisation of ₹23,224.10 crore.     ===== 

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