Amber Enterprises: BULLISH BUY Signal from Prabhudas Lilladher! Can Stock Soar to ₹8,901?

Amber Enterprises India's Consumer Durables (CD) segment experienced an 18.4% year-on-year decline in Q2FY26. This downturn was influenced by unfavorable weather conditions and strategic purchase deferments ahead of the Goods and Services Tax (GST) rate reduction, which impacted the broader Room Air Conditioner (RAC) industry even more severely, with an approximate 35% decline.

Looking ahead to FY26, the company anticipates the RAC industry to remain flat. However, Amber Enterprises projects its own CD segment to achieve robust growth of 13-15%. The Electronics division saw its EBITDA margins contract by 190 basis points to 5.8%, primarily due to increased costs of copper clad laminates and gold prices. Despite this, the company expects margins to rebound to the 8-9% range for FY26.

The Railway division demonstrated resilience with 6.9% growth in Q2FY26 and holds significant future potential, with the company aiming to double its revenue within the next two financial years.

**Brokerage View & Outlook** Prabhudas Lilladher has upheld its 'BUY' rating on Amber Enterprises India while adjusting its earnings estimates downwards by 19.7% for FY27E and 13.4% for FY28E. The brokerage has set a Sum-of-the-Parts (SOTP) based target price of ₹8,901, a revision from the earlier ₹9,889. This valuation attributes a 26x EV/EBITDA multiple (Sep-27E) to the Consumer Durables segment. The firm forecasts a Compound Annual Growth Rate (CAGR) for revenue, EBITDA, and Profit After Tax (PAT) of 20.9%, 25.6%, and 43.8% respectively, spanning FY25-28E. They anticipate EBITDA margins to expand by approximately 90 basis points, reaching 8.8% by FY28E.

**Impact** The maintenance of a 'BUY' rating by Prabhudas Lilladher, coupled with a specific target price, suggests continued confidence in Amber Enterprises' long-term prospects despite short-term segment challenges and revised earnings estimates. This positive analyst sentiment could influence investor perception and potentially support the stock price. (Rating: 7/10)

**Definitions** * **Consumer Durables (CD)**: Products like refrigerators, air conditioners, and washing machines designed for long-term use. * **RAC**: Room Air Conditioner, a device used to cool the air in a single room. * **GST**: Goods and Services Tax, a consumption tax imposed on the supply of goods and services in India. * **EBITDA**: Earnings Before Interest, Taxes, Depreciation, and Amortization; a key metric for assessing a company's operational profitability. * **EV/EBITDA**: Enterprise Value to EBITDA; a valuation multiple used to compare companies within the same industry. * **CAGR**: Compound Annual Growth Rate; the mean annual growth rate of an investment over a specified period longer than one year. * **SOTP**: Sum-of-the-Parts; a valuation methodology that assesses a company by valuing each of its distinct business segments separately and then summing these individual valuations.