🧵 At a Glance
Amber Enterprises isn’t Voltas, Blue Star, or Daikin — but it quietly makes a lot of their air conditioners. With a 29% market share in India’s RAC (Room Air Conditioner) manufacturing, Amber is the OEM behind the scenes, powering your summer without branding itself all over IPL. But with a P/E of 90+, is this growth story overheating?
❄️ Chapter 1: The AC Behind the AC
- Amber is India’s largest contract manufacturer for RACs.
- Clients include Voltas, LG, Panasonic, Daikin, Whirlpool, Blue Star, and more.
- It doesn’t do flashy branding — just makes the actual machines for those who do.
- Think of it as the Foxconn of Air Conditioners.
💡 3 product lines:
- Complete RAC units
- Critical components like heat exchangers, condensers, PCBAs, etc.
- Non-RAC appliances (like air coolers, washing machines, small appliances)
📊 Chapter 2: Financials — Cool Growth, Hot Valuation
| Metric | FY25 | FY24 | FY23 | FY22 |
|---|---|---|---|---|
| Revenue (₹ Cr) | 9,973 | 6,729 | 6,927 | 4,206 |
| Net Profit (₹ Cr) | 251 | 139 | 164 | 111 |
| EPS (₹) | 72.01 | 39.44 | 46.66 | 32.41 |
| OPM (%) | 7% | 7% | 6% | 7% |
| ROCE | 14.4% | 10% | 11% | 8% |
| ROE | 11.2% | 10% | 11% | 8% |
📈 Sales CAGR (3Y): 33%
🔥 Profit CAGR (3Y): 30%
🧊 OPM steady in 6–8% range — no margin explosion despite scale.
💡 Chapter 3: What’s Working for Amber?
✅ Massive OEM client base: Most Indian RAC brands depend on Amber for backend manufacturing.
✅ Component edge: It’s not just assembling ACs — Amber makes critical parts like motors, exchangers, and even PCBs.
✅ Diversification: Moving beyond RACs into white goods, air purifiers, smart appliances, and exports.
✅ Debtor Days Falling: From 80.7 to 64 — better cash flow, less stress.
✅ Subsidiary Scale-Up: Ascent Circuits (PCB manufacturing) now classified as a material subsidiary — crossing 10% of net worth.
🔎 Chapter 4: What Should Make You Sweat
⚠️ P/E of 90+ — markets are pricing perfection.
⚠️ Zero dividend in a 10-year profitable journey.
⚠️ Borrowings jumped from ₹1,539 Cr to ₹2,059 Cr in FY25.
⚠️ High Capex Cycle — annual depreciation now ₹228 Cr, and CWIP remains high.
⚠️ Low 3Y ROE (9%) despite solid topline growth — margin scaling not keeping pace.
⚠️ Cash Flow Wobble — while FY25 operating cash is strong (₹711 Cr), investing outflow (₹953 Cr) eats into it.
🧬 Chapter 5: Peer Pressure – Who’s Coolest?
| Company | P/E | ROCE | OPM | FY25 Revenue (₹ Cr) | Profit (₹ Cr) |
|---|---|---|---|---|---|
| Voltas | 52 | 17.6% | 7% | 4,768 | 235.7 |
| Blue Star | 57 | 26.1% | 8% | 4,019 | 194 |
| Crompton | 40 | 19% | 9% | 2,061 | 171.7 |
| Whirlpool | 48 | 13% | 7% | 2,005 | 119.5 |
| Amber | 90 | 14.4% | 7% | 9,973 | 251 |
🧊 Amber has the highest revenue, but also the most aggressive valuation.
💰 Chapter 6: Valuation – Is It Chilling or Overbilling?
Current Market Cap: ₹22,088 Cr
EPS FY25: ₹72.01
Current P/E: 90.69
P/B: 9.65
Let’s apply some sanity:
🔹 Conservative Case
- FY26 EPS: ₹85
- Reasonable P/E: 40–45
- 👉 Fair Value Range = ₹3,400 – ₹3,825
🔸 Growth Optimist Case
- FY26 EPS: ₹95
- P/E: 50–60
- 👉 Fair Value Range = ₹4,750 – ₹5,700
🎯 EduFair Value Range = ₹3,800 – ₹5,200
🚨 At ₹6,500+, this is priced for perfection.
🧾 TL;DR — Amber Enterprises Stock Recap
- 🧊 India’s #1 OEM for ACs — 29% RAC market share
- 🧮 3Y Revenue CAGR = 33%, Profit CAGR = 30%
- ⚙️ No brands, just backend manufacturing for everyone
- 🧨 Expanding to white goods, exports, electronics
- 😨 P/E of 90+, no dividend, high capex
- 🎯 FV Range: ₹3,800 – ₹5,200
- 📊 Verdict: Growth leader with real business strength, but valuation is way ahead of fundamentals
✍️ Written by Prashant | 📅 June 23, 2025
📌 Tags: amber enterprises, air conditioner oem, rac industry, contract manufacturing, white goods, eduinvesting
