Amber Enterprises India - Q1FY21 First Cut - ICICI Securities

(CMP: Rs. 1785; MCap: Rs. 5613 crore)

Amber Enterprise's performance in Q1FY21 were impacted by Covid-19 related plant shutdown and lower volume offtake by its key customers in the peak season.

Q1FY21 Earnings Summary

- Despite being a strong quarter, RAC industry faced challenges in Q1 due to lower volume offtake amid lockdowns. As a result, Amber Enterprises also faced a sales loss of almost 40 days in Q1FY21 and reported 79% YoY fall in revenue to ~Rs. 260 crore during the same period

- While gross margin remain flat on a YoY basis, the company reported loss at EBITDA level to ~ Rs. 6 crore mainly due to higher employee cost and other expenditure (up by 676 bps and 471 bps YoY respectively). The corresponding EBITDA for the period of Q4FY20 and Q1FY21 were at Rs. 102 crore & Rs. 117 crore, respectively

- Company reported loss of ~ Rs. 24 crore at PAT level (against profit of ~Rs. 65 crore in Q1FY20 and ~Rs. 63 crore in Q4FY20) largely attributable to lower sales & other income and higher depreciation charges

We like Amber for its leadership position in the RAC OEM/ODM industry in India with a strong customer base. Focus on component business provides Amber an edge over the competition to acquire new customers and increase the wallet share of existing customers. Further, we await management commentary on future outlook of demand recovery in RAC industry as well as business opportunities under Atmanirbhar Bharat schemes. We will come out with detailed reported post concall.

Shares of Amber Enterprises India Ltd was last trading in BSE at Rs.1785.15 as compared to the previous close of Rs. 1688.7. The total number of shares traded during the day was 7978 in over 974 trades.

The stock hit an intraday high of Rs. 1801 and intraday low of 1700. The net turnover during the day was Rs. 14038213.

Source : Equity Bulls

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