Amber Enterprises Is Rewriting Its Growth Story: Here’s What the Management Signals

More than just an AC manufacturer?

Amber Enterprises has long been associated with India’s room air-conditioner manufacturing. However, insights from the company’s latest management interaction suggest that this description is becoming increasingly incomplete.

While consumer durables continue to form the backbone of the business, Amber is rebalancing its revenue mix, with electronics and railways emerging as meaningful contributors. The objective is clear: reduce reliance on a single seasonal segment and build a more diversified and resilient earnings base.

Consumer durables remain the base, even as growth moderates

The room air-conditioner (RAC) industry is expected to remain largely flat in FY26, weighed down by higher prices following energy-efficiency upgrades and elevated input costs. Even so, Amber continues to maintain a 25–28% share of the RAC manufacturing market, reflecting its scale, long-standing customer relationships and execution capabilities.

After a brief slowdown caused by unseasonal rains, demand has normalised. More importantly, AC penetration in India remains low at 10–11%, keeping the long-term demand story intact.
Amber’s gradual shift from basic assembly to OEM and ODM manufacturing, coupled with rising localisation by Japanese brands, further strengthens its competitive position.

Alongside this, electronics is taking on a larger role

While the AC business provides stability, management commentary points to electronics emerging as a meaningful growth driver.

The acquisition of Shogini Technoarts strengthens Amber’s PCB manufacturing capabilities and diversifies its customer base across power electronics, telecom, defence and industrial applications. Over the next three years, electronics is expected to contribute 30–40% of overall revenue, supported by double-digit EBITDA margins.
For FY26, management has guided for 8–9% EBITDA margins in the electronics segment, with margins expected to improve further as scale and synergies build.weighed

In parallel, the upcoming HDI PCB project, backed by central and state incentives, adds long-term visibility, with trial production expected from FY28. Together, these initiatives signal a clear intent to scale up higher-margin electronics manufacturing.

Railways adds a smaller but high-visibility stream

Meanwhile, Amber’s railway business – covering doors, gangways and HVAC systems –  continues to add visibility to the overall earnings profile. The segment has built an order book of ₹26,000 crore, providing comfort on medium-term execution.

While FY26 is expected to remain steady, management is targeting strong double-digit growth thereafter, with revenues expected to double over the next two years. With margins estimated at 16–18%, railways is expected to play a growing role in improving the quality and stability of earnings, despite being a smaller contributor today.

What this shift means for the financials

As the contribution from electronics and railways rises, Amber’s financial trajectory is expected to improve steadily:

• Revenue growth of around 22% CAGR over FY25–28
• Profit growth projected at a faster ~42% CAGR
• EBITDA margins likely to expand to ~8.6% by FY28
• Planned capex to be funded through internal accruals and subsidies

While near-term earnings estimates have been marginally revised to reflect industry conditions, the broader medium-term growth picture remains intact.

PL Capital’s view

PL Capital believes Amber Enterprises is progressively transitioning from an AC-centric manufacturer to a more diversified manufacturing platform spanning consumer durables, electronics and railways. While near-term earnings may reflect industry softness and input cost pressures, the evolving business mix is expected to support stronger margins and more stable earnings over the medium term.

At the current market price of ₹6,626, PL Capital maintains a BUY rating on Amber Enterprises with a target price of ₹8,269, implying an upside of around 25%, backed by improving business mix, execution strength and long-term growth visibility.

For a comprehensive analysis of Amber Enterprises’ medium-term outlook, refer to PL Capital’s research report !