By Aditya Raghunath
Investing.com -- Amber Enterprises India Ltd (NS: AMBE ) manufactures air conditioners (ACs). Just before the second wave of the pandemic, when the Indian economy had started opening up, and there were predictions of a hot summer, the outlook for the stock, and the industry, was very bright.
Sector analysts had expected AC sales to go up by 25% this summer. However, this summer was a complete washout. And hopes of those increasing numbers vanished.
Amber Enterprises’ stock price hit a peak of Rs 3,553 on March 8, just a week before the second wave hit. It has continuously fallen since then and closed June 23 at Rs 2,917.
Brokerage firm Goldman Sachs (NYSE: GS ) believes that the company can rebound and has given the stock a 12-month target of Rs 3,950, an upside of just over 35% from current levels.
“Driven by tailwinds from the above factors, we expect Amber to deliver 28% Ebitda growth over FY20-26 aided by the PLI scheme for AC components. Our 12-month DCF-based price target of Rs 3,950 implies the stock would likely trade at 30x/16x FY24/FY26 EPS,” analysts at the bank said.
Sachs called Amber, which has a 23% share in the Indian home AC market, a ‘specialist’ and said that it would be one of the biggest beneficiaries in the space.
Add Chart to Comment
We encourage you to use comments to engage with users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind:
- Enrich the conversation
- Stay focused and on track. Only post material that’s relevant to the topic being discussed.
- Be respectful. Even negative opinions can be framed positively and diplomatically.
- Use standard writing style. Include punctuation and upper and lower cases.
- NOTE: Spam and/or promotional messages and links within a comment will be removed
- Avoid profanity, slander or personal attacks directed at an author or another user.
- Don’t Monopolize the Conversation. We appreciate passion and conviction, but we also believe strongly in giving everyone a chance to air their thoughts. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
- Only English comments will be allowed.
Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.