AMBER ENTERPRISES (+) : Mobile foray; Balancing the scales

Research evidence excerpt

AMBER ENTERPRISES (+) : Mobile foray; Balancing the scales

EQUITIES

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OUTPERFORM TARGET PRICE EPS 03/28e EPS 03/29eAMBER ENTERPRISES PRICE* INR7,889  TARGET PRICE INR9,050 (UPSIDE 15%)  9%  8%  10%

Mobile foray; Balancing the scales

AMBER’s recent pact with ‘Oppo Mobiles India’ marks its entry into the domestic mobile22 JUNE 2026

Securities Research Report manufacturing ecosystem. We see this move as a strategic act that complements its electronics

Production time: 03:33* (London time)

division’s high‑margin, value‑added growth – fuelled by recent acquisitions, which entail high WC

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intensity and low FATO (x) – with an asset‑light, low‑margin, high‑volume mobile business that offers

Nirransh Jain a modest WC intensity (4-5 days). AMBER’s low ROE, given its seasonal RAC business, has beenBNP Paribas Securities India Private

Limited one of the key concerns. While we have consistently argued for valuation re-rating potential with the

+91 22 6196 5039 underlying electronics business transformation with better margins and ROEs, we see the foray into

nirransh.jain@asia.bnpparibas.com

mobile manufacturing to be ROE accretive (c25-30%) and better OCF generation despite being

margin dilutive, with a vast TAM potential as it ventures into more components. Retain O/P.

c13-15m FY29 volume guidance; c1.5-2% margin; sub-lease Oppo’s existing facility

Call highlights: 1) gradual ramp-up, with trial production by 4QFY27 and commercial manufacturing

in 1QFY28 (c8-9m FY28 volume guidance), with an aim of reaching c13-15m by FY29; 2) c1.5-2%

EBITDA margin depending on SKUs (c1.5-1.7% for higher end model); 3) production in Oppo’s

existing facility using sub-leased production lines (no regulatory hurdles like PN3 approval), thus