Amber Enterprises will begin manufacturing smartphones for Oppo, OnePlus, and Realme through a partnership with Oppo Mobiles India. Production is scheduled to start in early 2028 with a target of 16 million annual units. While this move diversifies Amber's electronics business, investors should watch how the low-margin nature of mobile manufacturing impacts the company's overall profit margins.
Amber Enterprises is expanding its reach into the mobile handset manufacturing sector through a strategic partnership with Oppo Mobiles India. The company will manufacture smartphones for the Oppo, OnePlus, and Realme brands. This move marks a significant pivot for Amber, which is best known for its leading position in air conditioning and home appliance components.
Trial production is scheduled to begin in the final quarter of fiscal year 2027, with commercial output expected to launch in the first quarter of fiscal year 2028. The company has set ambitious production targets, aiming for an initial output of 8 million units in the first year. It expects to scale this capacity to approximately 16 million units in the second year, signaling a major ramp-up in its operations.
This partnership aligns with a trend where global mobile brands are increasingly adopting an asset-light model in India. By outsourcing manufacturing to experienced players, these brands aim to reduce their own capital spending and infrastructure footprint. For Amber, this provides a large, high-volume revenue stream, helping it diversify beyond its traditional consumer durables business.
Investors should keep a close watch on the impact of this new segment on the company’s profit margins. Smartphone manufacturing is typically an Electronics Manufacturing Services (EMS) business, which often operates on very high volumes but thin profit margins, usually with EBITDA margins below 3%. As this segment grows, it may have a dilutive effect on Amber's overall profit margin profile compared to its traditional business lines.
Operational challenges remain a key factor. In its Printed Circuit Board (PCB) business, the company is already facing pressure from rising costs of raw materials, specifically Copper Clad Laminates (CCL). Amber noted that it is passing these cost increases on to clients, but there is often a time gap before these price adjustments take full effect, which can temporarily hurt earnings.
In terms of recent financial performance, the company reported a revenue of ₹3,888 crore in the first quarter of fiscal year 2027, representing a 13% growth year-on-year. However, net profit for the same period declined by 78.5% to ₹22.3 crore, largely due to a one-time loss of ₹123 crore.
Looking ahead, the primary monitorables for shareholders will be the company’s ability to execute this large-scale production ramp-up without operational delays or cost overruns. Investors will likely look for updates on margin stability, the company's success in managing raw material price fluctuations, and how efficiently the new mobile division integrates into its existing manufacturing structure.