Amber Enterprises India Limited (NSE: AMBER) Q3 2025 Earnings Call dated Jan. 24, 2025
Corporate Participants:
Jasbir Singh — Executive Chairman and Chief Executive Officer and Whole-time Director
Sudhir Goyal — Chief Financial Officer
Analysts:
Nattasha Jain — Analyst
Bhoomika Nair — Analyst
Aditya Bhartia — Analyst
Aniruddha Joshi — Analyst
Ankur Sharma — Analyst
Dhruv Jain — Analyst
Teena Virmani — Analyst
Achal Lohade — Analyst
Nirransh Jain — Analyst
Deepak Krishnan — Analyst
Amit Mahawar — Analyst
Manoj Gori — Analyst
Shrinidhi Karlekar — Analyst
Vipraw Srivastava — Analyst
Naushad Chaudhary — Analyst
Presentation:
Operator
Ladies and gentlemen, good day and welcome to Amber Enterprises India Limited Q3 and 9M FY ’25 Earnings Conference Call. As a reminder, all participant lines will be in the listen-only mode and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the conference call, please signal an operator by pressing Star 10 0 on your touchstone phone. Please note that this conference is being recorded.
I now hand the conference over to Mr Jesbia Singh, Executive Chairman and CEO and Whole-Time Director of Amber Enterprises India Limited. Thank you, and over to you, Mr Singh.
Jasbir Singh — Executive Chairman and Chief Executive Officer and Whole-time Director
Hello, good morning — greetings for 2025, and thank you for joining from different time zones. On the call today, I’m joined by Mr Singh, Managing Director; Mr Sudhir Goyal, Group CFO; Mr Sanjay Arora, CEO of Electronics division and Whole-Time Director of Electronics. We have uploaded our results presentation on the exchanges and I hope everybody had an opportunity to go through the same.
I am pleased to report robust quarterly performance in-quarter three FY ’25 with revenue of INR2,133 crores, registering growth of 65%. Operating EBITDA almost doubled to INR12 crores, recording 97% growth and PAT grew to INR37 crore from a loss of minus INR1 crores over corresponding period previous year.
As you are aware, we have three business divisions, namely Consumer Durable division, Electronics division and Railway Subsystem and defense. So let me take you through the divisional performance. The Consumer durable division, which consists of Room AC and its components plus non-room AC components and washing machine. The RAC industry continued the growth momentum with channel inventory filing during quarter three in anticipation of the positive summer season. We recorded the blended division growth of 67%, led by both RIC and non-RAC vertical. RAC grew by 71% and non-RAC vertical grew by 43%.
Operator
Management, please go-ahead.
Jasbir Singh — Executive Chairman and Chief Executive Officer and Whole-time Director
Yeah. And the resultant EBITDA of INR116 crore, reflecting growth of 150% over last year. The strong performance is driven by the underlying growth in RHC industry, coupled with conversion of new customers from gas charging to ODM and deepening of customer relationships. Beyond the RHC, the commercial AC is picking-up trust. I’m pleased to report addition of one new customer and strengthening of commercial AC order book. The washing machine JV with is progressing well and trials are in-process with new customer — progressing with new customers. And we expect to commence the mass production from the new plant by H1 of the next financial year.
Switching to Electronics division, the division continued the remarkable growth momentum clocking revenue of INR472 crore, reflecting growth of 96% and resultant EBITDA of INR34 crore, reflecting 193% growth. Looking into current order book, we are pleased to revise our revenue growth guidance for Electronics division from 45% earlier to 55% for FY ’25, propelled by both PCBA and Bayer board verticals. The journey which began to capture the technological shift from fixed speed inverter — fixed speed AC to inverter AC in 2018 has now evolved into a comprehensive full stack EMS company.
In the PCBA vertical, we continue to expand our customers with addition of renewable energy customers. On the strategic expansion front, the construction is progressing well for the new facility at Hosur and we expect to start commercial production by Q4 of FY ’26. Additionally, we earlier announced the JV for HDI flex and semiconductor substrates PCBs with Korea Circuit Company, a pioneer for Korean PCB industry with more than four decades of experience.
To reiterate, the JV will bring the world-class technology into India, will leverage on connect with marquee global customers along with an interim buyback arrangement for initially two years. On way forward, we are waiting for the finalization of the electronic component scheme by Ministry of Electronics and IT, which as per the recent media articles has got the node from the finance ministry, while in parallel, we are scouting for the land and have started engaging with the customers. To summarize, the electronic division is on transformative growth path with addition of customer applications on PCBA front and on the Bayerboard front, the SN facility expansion coupled with Korea Circuit JV will unlock the new scales for the company.
Now coming to our third division, railway Subsystem and defense. The division reported a muted quarter with decline of 13% in-quarter three on expected lines owing to delay in offtake of products. The division profitability also got impacted due to delays and product expansion expenses. We expect to get back to normalized range of 18% to 22% by H2 of FY ’26. To emphasize delays in offtake are momentary with no cancellations of orders. During the quarter, we further strengthened the order book with an additional air-conditioner order for a metro project.
And on the defense front, the vertical is gathering a robust traction with visibility on sizable export opportunities over mid-term. On the expansion front, the construction is progressing well for Sidwal’s greenfield facility for HVAC pantry doors and gangways and is expected to commence operations by quarter two of FY ’26. Similarly, the JV with Machinery of South Korea is progressing well. We expect the facility to be ready by quarter one of FY ’26, product trials to begin from quarter two or quarter three FY ’26 onwards from — for the driving gear coupler and Pentograph.
We continue to remain confident on the long-term potential of division and maintain our guidance of doubling the revenue in next three years, backed by strong order book visibility of INR2,000 crore-plus and increasing wallet share. To sum-up, we witnessed a robust quarter and we look-forward. The roadmap is in-place for multifold scale-up for each division as expansion strategy unwinds.
Now let me hand over to Sudhir Goyal, our CFO for the financial highlights.
Sudhir Goyal — Chief Financial Officer
Hello, everyone. Good morning. I’m pleased to report a strong performance for quarter three and nine months for financial year ’25.
Let me first take you through the quarterly consolidated financial highlights. The consolidated revenue for quarter three financial year ’25 grew by 65% year-on-year to INR2133 crores compared to INR1295 crores in previous year and operating EBITDA increased to INR162 crores during the quarter compared to INR82 crores last year, reflecting a strong growth of 97% year-on-year. Please note operating EBITDA is before impact of ESOP expenses and other non-operating income and expenses. We record PAT of INR37 crores against a loss of INR1 crores in previous year same quarter.
Let me take you through the nine months financials. Revenue for nine months financial year ’25 increased to INR6 to INR19 crores compared to INR3924 crores in previous year, recording a growth of 59%. Operating EBITDA increased to INR482 crores against INR285 crores in nine months financial year ’24 with a growth of 69% year-on-year. PAT increased to INR133 crores compared to INR40 crores in previous year, reflecting a growth of 228%.
Now let me take you through the divisional performance. Firstly, revenue and operating EBITDA details are not comparable with the published segmental results. To start with Consumer Durable division, the division reported revenue of INR15 crore in-quarter three financial year ’25 compared to INR932 crores, reflecting a growth of 67% year-on-year on the back of strong REC business growth driven by positive season. Operating EBITDA for the quarter increased by 150% year-on-year and stood at INR116 crores compared to INR46 crore in-quarter three financial year ’24.
Coming to Electronic division performance, revenue and operating EBITDA sales are not comparable with published segment results. The revenue for the quarter increased to INR472 crores compared to INR241 crores in previous year, reflecting a growth of 96% year-on-year. Operating EBITDA for the quarter increased by 193% year-on-year and stood at INR34 crores compared to INR12 crores in-quarter three financial year ’24. I will reiterate, we are progressing well and expect to close the year with revenue growth in excess of 55% for financial year ’25. There is a revision in guidance earlier was 45%, now we are growing by more than 55% during the year.
Moving to Railway subdivision and defense division performance. Again, to emphasize the revenue and operating EBITDA, details are not comparable with the public segmental results. The division reported a muted quarter owing to slower offtake as mentioned earlier. The revenue for the quarter stood at INR106 crores, reflecting a decline of 13% year-on-year and resultant operating EBITDA of INR12 crores, impacted due to slower offtake and product expansion expenses.
On the return on capital employed, with the strong underlying business performance, we expect improvement in and expect to cross 15% mark by the year end. Just to summarize the key initiatives taken earlier during the year of Ascent X facility expansion, JV with Korea Circuit and expanding product portfolio of railway bodes well for the growth of the company.
Now I hand it over to the operator and happy to answer all the queries.
Questions and Answers:
Operator
Thank you. We will now begin the question-and-answer session. Anyone who wishes to ask a question, I press star and one on your touchstone telephone. If you wish to remove yourself from the question queue, you may press star and two. Participants are requested to use handsets while asking a question. As a reminder, to all the participants, please restrict yourself to two questions. Ladies and gentlemen, we’ll wait for a moment while the question queue assembles. Thank you. The first question comes from the line of Natasha Jain with PhillipCapital. Please go-ahead, sir.
Nattasha Jain
Yeah, thank you for the opportunity and congratulations team for a great set of numbers. These are my first. I have two questions. My first question is on the RAC side. So now in the past few quarters, we did more of assembly because of which our margins were flattish. Now when I see your consolidated gross margin, you further declined by 106 basis-points. So I just want to know if you could throw some light as to how RAC components did versus RAC assembly and some growth in-between those two segments.
Jasbir Singh
So the gross margin impact is largely due to the product mix. Like we need to give you the very detailed this explanation for that because margins varies on product-to-product. And like we explained earlier, there are a different margin for different star rating, different energies, plus component — which component revenue-share is how much. So it’s very difficult to give you the complete makeup at how to measure it. But it’s a — it’s a normalized thing and there is no big impact in the margins — gross margins during the financial year.
Nattasha Jain
Can we expect that the components business is picking-up, specifically the RSE components?
Jasbir Singh
Yes, the components business is picking-up. On the back other side, RSE is also picking-up. If you see the growth of the — in both the products, there is a good growth we are — we have done in the current quarter and the full nine months as well.
Nattasha Jain
Understood, sir. Sir, and my second question is on the electronics side, as you’ve revised your guidance upward from 45 to 55. Now given in the short-term, we have capacity constraints for accent and also there has been ASP decline in hearables and wearables. So what is going to be needle so much that we are revising our guidance so much?
Jasbir Singh
First of all, congrats on your new role and good morning. So much sir. We are actually — if you see the traction and the journey of electronics division, you know, we keep on — we’ve added lot of applications. So we started our journey with the consumer durables, specifically by supplying PCB applications and assembly boats to consumer durable, especially air-conditioners and then we graduated into refriger washing machine. But now we are giving solutions in the space of telecom, in smart meter space. We are giving solutions in the auto space, both four-wheeler and two-wheeler and in fact, recently, we have just started the commercial vehicles business also and we’ve onboarded defense. So looking into that, plus the SN Circuit growth potential, we have revised the guidance and we are very strongly hopeful that we shall be able to maintain more than 55% of the growth of this vertical.
Operator
Thank you. MS. Jain, please rejoin the queue for more questions. Next question comes from the line of Pumi with TAM Capital. Please go-ahead.
Bhoomika Nair
Yeah, good morning, sir, and congratulations on a great set of numbers. Sir, just wanted to understand the RAC segment a little better. Now if I look at it for the nine-month period, we’ve grown fairly well. Even in this quarter, we’ve grown about 71%. Now if you understand a lot of the brands are putting up a lot of capacities and in a lean season two, they’ve continued to outsource. So if you can just explain what’s driving this growth, what’s the end-market growth? And coming into the next season, given the overall slowdown in consumption and the base of last year being very-high, how are you looking at the upcoming season really?
Jasbir Singh
Good morning,. You know, we feel that first of all, you know, I’ll give you the reason for 71% growth of this vertical you know you would be aware that we were doing gas charging for large multinational companies. And we have been telling that we are converting those into ODM players and that has already happened. And that’s the — that’s the reason of the growth.
And also, you know the factories which brands were putting, it has already done. So there is no more new factory which is getting announced as of now. All the six brands who were putting up, their factories are up and running. There is no brand which is left out now. And you know, from our perspective as a solution provider, we have tagged along with them while supplying our components as well as finished goods. So this year, we have also seen some spillover because of a large demand of which came to us and that’s the reason why we have outnumbered the industry growth.
For coming year, I personally feel that industry should be growing it. This year industry ends up at about 25% growth. Next year, industry is expecting good summers and in that anticipation, they are ramping-up the inventory right now. But you are right that there is some demand slowdown. We yet need to see that slowdown because right now, inventory is getting filled at the primary level at the dealers level and that’s how the ramp-up is happening. But as far as Amber is concerned, I think we will grow in tandem with the industry. And because of our addition of some new customers onboarded, we may outnumber the industrial growth next year.
Bhoomika Nair
Sure, sir. This is helpful. Sir, on Sidwal, you spoke about you know you the deferment by Indian Ailways, which has resulted in a bit of a sluggish nine-month period. Now going ahead, how are you looking at the ramp-up coming back because this year we will probably see some decline in revenues and drop-in margins. But as you move ahead into ’26, where do you see the acceleration coming through? What kind of you know execution can be there? And do margins then revert back to 20% if revenue growth comes back or should we structurally look at a lower-margin profile out here?
Jasbir Singh
Gumika, we intimated the everybody in last quarter also when we — when the railway announced focus on non-ACE production because of the accidents which happened and there was lot of UN cry in the market that you know government needs to plan on the BPL families also for the AC, but the government is only thinking about air-conditioned trains. So the focus entirely changed and that’s why we revised our guidance that this will be a muted year.
And right now, if I see, there were — there were two main issues. One is the 200 Vande Bharat Express order that got delayed in execution because of the structural shift in the number of coaches. Earlier, one train was having 16 coaches. Now government has revised it to 24 coaches. So the whole construct of designing of the train systems get changed and that’s delayed. But now what I’ve heard just 10 days back is that they have been cleared. So most probably it is moving by a year delay. So next year, this whole will come back from H2 onwards.
And as far as another project which was delayed was the Mumbai Metro project. Again, we are hearing now since the elections are over and everything is done in Maharashtra. So that is also coming up again on-track. Apart from that, there is nothing — no change in Sidwal. Yes, we did get hit in the margins because of — in anticipation of the growth, the expenses also were increased. There were teams which were built. And on the other side, there was the slowdown happened. These delays happened, which was totally not foreseen.
But what we feel right now is all these two projects are coming again on-board. We feel that the margins will come back again. We will continue to get hit for next quarter and next to next quarter. After that, we will see this margins coming up because the railways have already given us indication of resuming the supplies from H2 onwards. We expect this division to grow next year. And apart from that, there are some defense projects which are getting added and the order book on the defense side is also getting added. I believe next year, we should be able to come back to the normal 18% to 22% range by H2, post H2 range.
Operator
Thank you. MS. Tyer, please rejoin the queue for more questions. Next question comes from the line of Aditya Bharthia with Investec. Please go-ahead.
Aditya Bhartia
Hi, good morning, sir. Just wanted to understand these new customers that have been moved from gas charging to ODM solutions, how large could those customers be and how much they may have contributed in 3rd-quarter and nine months of this fiscal?
Jasbir Singh
Well, these are large multinational companies which were earlier importing their products and then the gas ban was announced by Government of India. So we started helping them in — by gas charging the products. But ultimately, the roadmap was very clear that you cannot continue like this. You have to either product — put up your own facility or you converted into manufacturing in India. And their volumes are growing. I think they are gaining traction. They are surpassed our expectations.
We thought that they will grow in range of 25% 30%, but two of our customers, they have grown by more than 45%. So we got benefited because of that and the whole shift of gas charging to ODM started giving us the more traction on the finished goods side. But one of the customers with the gas charging machine product category, they have put up their own factory and they have already allowed us to — for the supply of components. So we will be supplying components to one and we have started supplying finished goods to other two.
Aditya Bhartia
Understood, sir. So the reason why I was asking is that like you mentioned room AC category grew by 71%. I just wanted to kind of get some sense how much would have existing customers grown by and how much these new customers could have contributed? How relevant are these customers in the overall scheme of pace?
Jasbir Singh
So these are long-term contracts for this year because once you shift to ODM, when you design products and invest in the tools, so these are all long-term projects which are onbodied right now. As on the percentage side, I think very difficult to say because largely, you know customers have got added on the CSE front also, the commercial air-conditioners front also. These two, three customers which have — which have come on-board, you can say that they have been instrumental in giving us the growth over and above to the industrial growth.
Aditya Bhartia
Sure, sir. That’s helpful to understand. And is it fair to kind of think about outsourcing industry growing at a pace much, much faster than the overall industry in a good summer season and therefore the benefit being disproportionate this year.
Jasbir Singh
Well, see, outsourcing industry, it’s very difficult to predict at our level because we are a B2B solution provider. What we focus on is how deeply we can deliver comprehensive solutions to the industry. I particularly feel that you know if last year India was at 10 million mark, you know this year with a 25%, 30%, we should end-up at INR1 crore, 30 lakhs market. By FY 30, it is expected to be close to about INR3 crore or 3.5 crore air-conditioners. And if we see last five years — a four year’s trend also from 7.2 million in COVID time, it has come to 1.3.
So looking into this, there is a 3x growth kind of a thing possible for this if these numbers stack-up rightly. So enough growth for everybody in the whole air-conditioning industry. I personally feel we are tagging along with the industry growth. The strategical shifts of customers will continue. They may outsource, they may buy components. So from our side, it is very important the relevant thing from our side is that how — how much business we are doing with the customer on the absolute basis, irrespective of the structure and form of the solutions which we are providing.
Operator
Thank you. MR. Bharthia, please rejoin the queue for more questions. Next question comes from the line of Joshi with ICICI Securities. Please go-ahead.
Aniruddha Joshi
Yeah. Sir, congrats for excellent set of numbers. So currently, the industry capacity — how do you see the current industry capacity of the brands as well as the four EMS players both put together? And how do you see the capacity changing by FY ’26 end and by FY ’27 end? I guess most of the projects are already in-place now. So what should be the capacity change maximum?
Jasbir Singh
And see, everybody has put up a different capacities, all the brands, all the six new units which had come are at very, very different capacities. Some have put up 0.5 million capacity, some have started 2 million capacity. But whenever a brand puts up a facility or you know, they will think long-term. So they have thought about next four, five years at least to put up these facilities. And to add-on the capacities on assembly lines is not a very big challenge because it’s just a six months job.
So you can — you can add the assembly businesses anytime, you know, while going — while moving in this season also. I believe that overall, we should look at it how the seasonal capacities are panning out. So on the seasonal capacity side, I would say industry should be at around 65% of capacity utilization, something like that. That’s a very ballpark number which comes to the mind. But every brand is at different capacity utilization. We cannot comment on behalf of our customers. But as Ambur is concerned, we are at a capacity utilization of 65% at the moment in our room air-conditioner facilities.
Aniruddha Joshi
Okay. Sure, sir, that’s helpful. Sir, on the second question, in a way, probably we would have gained the market-share. So is there any loss of market-share or is it pure industry growth that we would have grown? I mean, in a way, right now the kind of growth that we are building in is much higher than what the market growth also seems to be. So is there a potent — is there a likely market-share gain or in a way market would have also improved at similar rate in Q3
Jasbir Singh
That’s why we don’t calculate it on a quarterly basis. I think by year-end, we will calculate where are we? Last year, we were at 26% of the manufacturing footprint of air-conditioner. And if industry grows by 30% and numbers end-up growing by 50% 60%, then definitely we would have grown in our market-share.
Operator
Thank you. MR. Joshi, please rejoin the queue for more questions. Next question comes from the line of Ankur Sharma with HDFC Life. Please go-ahead.
Ankur Sharma
Yeah, hi, good morning, sir. Thanks for your time. Just one question. On this proposed JV with Korea Circuits on the manufacturing of PCBs. If you could just help us what is the overall capex that you’re looking at here, what could be the asset turns? And I understand we are expecting quite a bit of subsidy as well here. So yeah, some tours by when do you commission this plant?
Jasbir Singh
Yeah. Good morning, Ankar. So on the Korea circuit, we are waiting for government to finalize the incentive scheme. You would have all heard through the media reports that it has already got node from the finance ministry. So earlier we were talking of INR40,000 crore incentive, but the note which has come from the finance ministry is INR25,000 crore. And we are waiting for the structure. We are not privy to the structure — final structure which is going to come out for the — especially for the PCB parts. And once that is there, earlier we were hearing it is INR1,000 crore minimum investment, but now we don’t know because of this shift change, maybe they have reduced or they have increased, we are not knowing about that.
I personally feel that we expect that it should get announced by the budget time and in case it does so, you know — there will be a notification after that and then at least two to three months will be given for the applicants and then another two to three months for the approval systems. So by next year half, maybe by September, the approvals will be in-place and then that is when the process will start. But what we have done parallelly is we have started scouting for land and the incentives which is talked about is quite a good number. It is more than 40% for HBIs and semiconductor substrates from the central ministry and over and above to that state governments are also giving incentives like the expansion, we have been able to negotiate 35% of incentives from the state government. So we feel that it’s a time to put a bold foot forward for creating this whole ecosystem in India.
And if I have just to give you a just the numbers on the electronics getting consumed and the reason why we are planning this large capex whenever the incentive screens were announced. And largely if we see as India as a country consumed $32 billion of electronics eight years back. Last year, we consumed $115 billion. Business-as-usual is expected to be in the range of $300 billion, $285 billion to $300 billion, whereas our Honorable Prime Minister has taken a mission mode for getting the number to $500 billion because this is one sector which is labor-intensive and it creates a lot of jobs also.
If we see what it calculates into the total addressable market for the bare board PCB, last year this is a mighty number which I’m talking to you right now. It is I think available on the mighty’s website is the — India consumed about INR30,000 crore-plus PCBs and only 10% of that got manufactured in India. So with the incentive schemes coming in right now, I think there is a huge potential for this going up. And if we talk about five to 10 years from now, it is — there is a large potential and TAM available for this. And we will be a single stack company offering complete solution from single side multiple — multilayer RF category, flex category, HBI, semiconductor substrates, all categories in one place. So that is what we are aiming to deliver to Indian markets.
Ankur Sharma
So that’s very helpful,. Also, have you frozen on how much are you looking to invest in this JV in terms of overall capex number. I understand the subsidies that you’ll get thereafter, but is there a number you can share?
Jasbir Singh
See, there will be a threshold investment the criteria by government. So as I explained earlier, it was INR1,000 crore when we were talking of INR40,000 crore of incentive scheme. Now it would have been shifted. We don’t know whether it has shifted. That will be the number which we will have to put up for getting approved by the ministry. So if it is INR800 crore, we’ll have to do minimum INR800 crore. If it is more than that, we will have to do that. So I think it should be in the range of INR1,000 crore-plus.
Operator
Thank you. MR. Sharma, please rejoin the queue for more questions. Next question comes from the line of Dhruv Jain with Ambit Capital. Please go-ahead.
Dhruv Jain
Hi, sir. Good morning. Sir, the first question that I had was on the consumer durable side. So if you could just tell us what’s the peak capacity or the peak revenue that you can do with the current capacity. The reason why I’m asking this question is that government recently-announced the third round of the home of plant with PLA and Amber did not participate in that. So just your thoughts there. That’s my first question.
Sudhir Goyal
Well, you know, we’ve already got approval of INR400 crore PLI and that’s the reason why we did not apply for any further PLIs. And the earlier PLIs are moving very fine. We are getting reimbursement from government in time and we are very thankful to Indian government for all those reimbursements which are happening on-time. On the capacity utilization, to answer your question, I already addressed this question earlier, but I’ll reiterate. We are currently at 65% level and you can calculate where we can go with the complete 95% or 98% current capacity utilizations if that goes fine.
Dhruv Jain
Sure. And sir, the second question was on the JV losses, right? So we’ve seen that Q-o-Q the losses of JV have kind of inched up. So wanted to understand what’s the pathway or the broader, how should we look at this number going-forward in terms of how it breaks even and how those — how that number percolates into profits going-forward? Thanks.
Sudhir Goyal
Well, as far as-is concerned, that’s a new facility and the new product lineup, we believe that it should breakeven in next financial year. We should see losses coming down from quarter two of next financial year. And as far as the other JV is concerned, that is a turnaround story and we are expecting next financial year, it will continue to bleed. But after that, there is a complete turnaround story which is happening. They have received the new orders and a new CEO also has joined from, CEO has joined that company and there’s a lot of positive things which are happening.
Operator
Thank you. MR. Jain, please rejoin the queue for more questions. Next question comes from the line of Tina Firmani with Motilal Oswal Financial Services Limited. Please go-ahead.
Teena Virmani
Yeah, thanks for taking my question. Sir, my questions are related to this JV where Ankur also asked you on the expected turnover or the asset turnover that you can expect from this particular facility. So basically, if we take this assumption that the incentives are provided and invest into this particular facility, over a longer-term three to four year or a five-year term period where do we see the scale-up which can happen in this particular subsidiary of Ilgin and Korea Circuit?
And my second question is on the margins of railway segment. Like you mentioned that margins can come back to the normal 19% 20%, which it was earlier. But what kind of margin profile is there for the newer areas like those and gangways? Do you think that similar margins will be there for those portion also? So these are my two questions.
Sudhir Goyal
So on the first question, the asset turns normally in the PCBs are similar to businesses. It is in the range of 1 to 1.25. However, what — how we should look at it is since government is giving incentives almost 70% to 75% will be given back collectively by MIT as well as the state governments. So the asset turns from that perspective is much better. It goes to about 2.5 times the three banks.
Also on — to answer your second question on the railway front, yes, we expect the margins to come back from H2 onwards of next financial year. So first next quarter and next to next quarter will be impacted because of the slowdown, but then we are coming back again. On the margins of the new product categories, so first two trains will be coming from the principles in Korea as well as from Austria. But after that, it will shift to India. So since the first crude trains will come, that is just a trading, there will be hardly any margins in that. But once the manufacturing starts from H2 onwards from Q3 of the next financial year onward, the margin profile of these product categories are in the similar range of 15% to 18% range.
Operator
Thank you. Thank you. MR., please rejoin the queue for more questions. Next question comes from the line of Achil Lohade with Nuvama Institutional Equities. Please go-ahead.
Achal Lohade
Yeah, good morning, sir. Congratulations for great earnings. Sir, if you could give a sense, I know it’s kind of a repeated question, but for nine months, what would have been the industry growth in your estimate? I mean, you have said about 25% growth for the full-year. Does that mean that 4th-quarter the underlying assumption is actually a lower number?
Sudhir Goyal
Well, I think what we hear from different brands, everybody has grown differently, most of them are reporting 30%, 35% growth and some have reported 20% also. But on an industry side, I think the first-nine months would be somewhere about 30% growth kind of a thing, what we hear from everybody. Quarter-four, of course, is because it was a — it’s already a large quarter last year. So percentage-wise, there couldn’t — I don’t think so that we should look at 30% or 35% and that’s the reason why I said that industry should be in the range of 25% by year-end.
Achal Lohade
Understood. And the second question, sir, with respect to the electronics guidance, when you mentioned 45%, it implies actually a very small number for the 4th-quarter for the electronics revenue. So just wanted to understand what number could it be? I mean, is it very, very conservative number or is this a realistic number we should work with?
Sudhir Goyal
No, we have given a conservative number. We have already revised the guidance. We have said that now it is not growing at 45% is growing at 55% plus in that — for the complete year. So we are very hopeful, strongly hopeful to deliver that 55% growth in the Electronics division.
Operator
Thank you. MR. Lohade, please rejoin the queue for more questions. Next question comes from the line of Niraj Jain with BNP Paribas. Please go-ahead.
Nirransh Jain
Yeah, hi, sir, good morning and congratulations on a great set of results. Sir, my first question is on asset circuit. Just wanted to check-out like what is the revenue breakup for this quarter and the profitability as well? And one question from accounting perspective, why are we not seeing any flow-through in minority interest from the asset circuit. I mean, our minority interest has almost been flat in the last three, four quarters while the asset circuit revenue should start flowing in through, right? Or am I missing anything here?
Sudhir Goyal
Well, Ascent Circuit has done INR82 crores in-quarter three and we expect Ascent Circuit to grow in the range of 30%, 20 — sorry, 20% to 25% range. And we have onboarded five new customers recently. So whenever the new customer gets added, the share of business is very skewed initially for the first year and then it’s ramped-up — ramps-up. We are already getting very good traction in SM Circuit on the single multi-layer PCB business. It’s primarily because of the anti-dumping duty imposed and we expect that in next two years, SMC will be doubling its revenue from where it is today. There’s a lot of potential in that and that’s the reason why we are putting up capex also.
And you asked for second question, can you please repeat it?
Nirransh Jain
Sir, we are not seeing any change in minority interest in the last three, four quarters while we expect did that the assets and circuit profitably will also impact the minority interest. So just want to understand am I missing anything here? I mean, while the minority interest interests are not going up as per the like as the asset circuit revenue consolidates?
Sudhir Goyal
So we own 60% of that and it is a path to it is a path to control transaction which we have done with them.
Operator
Thank you. MR. Jain, please rejoin the queue for more questions. Next question comes from the line of Deepak Krishnan with Kotak Institutional Equities. Please go-ahead.
Deepak Krishnan
Hi, sir. I hope I’m audible. I just wanted to check, you’ve seen a lot of interest with other peers as well as companies potentially putting up competitor plants due to maybe restrictions of imports coming through. Our thought as to why we are not considering that given the sort of strong growth. So just your views on that, sir.
Jasbir Singh
We are already in touch with our suppliers for the capacities ramp-up and most of the suppliers are indicating a lot of capacity being ramped-up at their level. But however, in case we see that there is a shortage coming in, we’ll certainly plan.
Deepak Krishnan
Sure, sir. And maybe we just wanted to understand what is the inventory level currently in channel given the summer assets the previous summer was very strong because virtually stockouts and after now two quarters, seeing volumes coming through. So in terms of overall inventory level, is it at normalized levels? Do you see this good momentum continuing till Q4? And after that does it depend upon the season? Just maybe a check on the inventory level at an aggregate industry level.
Jasbir Singh
So you know, how we see is that brands buy from us only when there is a normalized inventory level or less inventory level. So our uptake is reflective that the inventory levels are at a very normalized level at this moment of time. However, we still need to see how the summer season spans out to be because generally the trend is that from December onwards, brands start pushing up filling the inventory at the dealers level and that’s how the primary sales happen. I think we all should look at the secondary sales number from February onwards that will actually define how the season is going on.
Operator
Thank you. MR. Kristan, please rejoin the queue for more questions. Next question comes from the line of Amit Mahawar with UBS. Please go-ahead.
Amit Mahawar
Hi, just. Congratulations on great scale-up across business lines. Sir, I just have one question. On a three to four-year basis, very clearly, the electronic division will lead the growth even in profitability and consumer is anyways going to be a steady-state. But in the electronic division, so across the two, three divisions, can you help us understand how will we strategize the exports opportunity? And once the new facility by Q4 ’26 starts and stabilizes in ’27, ’28. Should we expect a significant export scale-up or that’s going to cater to maybe 80%, 90% India only?
Jasbir Singh
Well, right now, Amit, it is 90% India and very small exports which are happening. But yes, as the ramp-up is happening, teams are already in touch with for a lot of exports, not only for PCBs, but PCBAs also. I believe you know for cracking customers outside India, it takes little time and gradual share of business grows. So if to answer your question on the three to four years trajectory, yes, we see a significant scaling up of exports happening from both Circuits as well as region?
Amit Mahawar
Sure. And a quick one on our capex and the cash flows. How should we think about maybe around next year or what kind of operating cash-flow you an investment should we understand? That’s it.
Jasbir Singh
Thank you. On the electronics side or you are asking for the whole group
Amit Mahawar
Overall,
Jasbir Singh
I can tell, Amit, division-wise. So we are planning for about INR250 odd crore capex in our Consumer Durable division where we are bringing up some new module lineups and also ramping-up on the component side of giving solutions plus, we are also investing for our exports readiness. And then we are also investing in our washing machine business category.
On the electronics side, we think that we have already announced INR650 crore capex in, out of which land parcel has come this year, then major portion will come next year, close to about INR400 crores to INR450 crores will be next year for the SM circuit and the Indian PCBs. And then our railway division has already been announced. We have — last year we announced INR350 crore capex for the two facilities which are coming up in Karideabad, out of which INR100 crore has already been spent — is being spent this year and about INR150 will come next year. So that is going to be the overall capex at the Group level.
Amit Mahawar
Okay. Thanks, sir and congratulations.
Jasbir Singh
Great. Thank you,. Okay.
Operator
Thank you. Next question comes from the line of Manoj Gori with Equirus Capital. Please go-ahead.
Manoj Gori
Yeah. Thanks for the opportunity, sir. Sir, I have just one question. If you look at there are some uncertainties around the supply-chain. Earlier it was on the group copper. Now currently there are on the compressor side as well for the upcoming copper. How do you see industry and universal place in terms of inventories and productivity? Can we expect some disruption if industry grows at around 15% or more than that?
Jasbir Singh
Yeah. So on the compressor supply-chain issue, so copper supply-chain issue has been resolved by government. They have already moved out the inner group from the category and the BIS has also been revised for one of the companies. And plus, we are very thankful to all the copper manufacturing companies who have put up the facilities for building up plain copper tube facilities. I think copper more or less is resolved.
As far as the compressor is concerned, I think February and March is good to go for everybody. But yes, April is little — sounds a little tricky because the shipments — there is a delay in shipments and the companies who the large order book was given to them, but they are — they are supplying in a little miser way, I would say. So April-May get impacted in case compressor issue doesn’t get resolved. But we are talking, I think we are getting assurances, but from China, we have now also shifted to other geographies. So I don’t think so that a very large issue should come up from that perspective on the compressor side also. Because if you see the worldwide, there’s a lot of capacities available.
Manoj Gori
Right, sir. Sir, secondly, on the electronics announcement or probably the scheme that the government is likely to announce. Any timelines do you expect like by when they should be coming out with any scheme announcements or any indications or any judgment from your.
Jasbir Singh
You are talking. I believe you are talking of the electronic component scheme
Manoj Gori
Yes, sir.
Jasbir Singh
Yeah, okay, so basically you, you know, since it has been nodded by the finance ministry, it’s a matter of time. It has gone to the cabinet. If we are expecting that it should get announced in the budget, but in case it doesn’t get announced in the budget, most likely it should come in the month of March. And after that, you know, government do give some time for applicants to apply. And then of course, there is a filtration process and approval process. So most likely by end of August, September, you know, all the approvals should be into place.
Operator
Thank you. MR., please rejoin the queue for more questions. Next question comes from the line of Srinidi Karlikar with HSBC. Please go-ahead.
Shrinidhi Karlekar
Yeah, hi. Thank you for the opportunity. Sir, would it be possible to comment broadly how much price increases are required in your AC Good business to compensate for the recent commodity increases and currency depreciation
Jasbir Singh
Well, there’s a little uptake on the gas refrigerant prices, which has impacted in the range of INR100 to INR120 per air-conditioner. Other than that, you know, it is a pass-on strategy from our side. So whenever any kind of currency or commodity is hit, we’ve demonstrated in past that we pass-on to our customers at a quarterly lag basis. So our is a B2B business. We — we operate on price variation clauses with our customers.
Shrinidhi Karlekar
Not much of inflation on the other component because of copper and. Apart from gas
Jasbir Singh
, you said that not really copper is in the same range currently operating.
Shrinidhi Karlekar
Fair enough. Thank you for answering my question. All the very best.
Operator
Thank you. Next question comes from the line of Viprav with PhillipCapital. Please go-ahead.
Vipraw Srivastava
Hi, I’m audible, right?
Jasbir Singh
Yes. Very audible.
Vipraw Srivastava
Right. Yeah, sure. Sir, quickly on the Korea circuits JV. So I mean if you look at circuits, they are also into manufacturing of semiconductor substrates. You are starting with bareboard manufacturing. You — what’s the timeline you’re looking at when you transition from bare board manufacturing to a semiconductor manufacturing
Jasbir Singh
So our JV is basically for HBI flex and semiconductor substrates. Now we will be beginning with HBIE as a first phase and then move to semiconductor substrates because we think that FY ’27, ’28 will be the year when India — India semiconductor ecosystem will get built-up. Before that we are planning for HBO.
Vipraw Srivastava
Fair enough. Fair enough. And sir, secondly is, I mean obviously, this whole capex which you’re going to do with the Kurya Circuits is going to be heavily financed by the government of India. So I mean, do you see the synergistic effect of this on the EMS assembly business also because what I feel is key, you might actually price out the competitors if you are backward integrated into wear goods.
Jasbir Singh
Well, of course, I mean, you know SM Circuits acquisition has really helped us for ramping our PCBA business also because SM Circuit is largely into telecom and auto and defense aerospace businesses. So we are now gaining traction because of the PCB. So there is a cross deployment of customers in both PCBA and PCB. And I believe we will be able to do that. And that’s the reason why we have commented that this journey started from INR300 crore in 2018 when we acquired Indian Electronics at that time EBITDA used to be 2.8% and this year you have seen the results and we’ve guided the markets that we’ll be growing 55% plus and we expect our margins to be in the range of 8% EBITDA. And I think there is a possibility of increasing it to double-digit number in next financial year itself.
Vipraw Srivastava
Right. So I mean, is the option correct that it will help you on having a quick ramp-up of your PCB facility?
Jasbir Singh
Yeah, so it was nice of them to accept arrangement of uptake of two years because in India, it takes little time for customers to approve and get the regulatory approvals and all. So for from our side, you the have agreed to the capacities for the first two years.
Operator
Thank you. MR., please rejoin the queue for more questions. Next question comes from the line of Nosha Choudhary with Aditya Birla Mutual Funds. Please go-ahead.
Naushad Chaudhary
Hi, thanks for the opportunity. And apology, I’m in a bad network. So if my call gets dropped. I have two, three very quick clarifications. Sir, first, in our electrical electronics business, typically what is the length of contract we do in this business and same for railway business?
Jasbir Singh
Well, it’s a — you know, depending on which applications we are serving, normally it takes close to about 2.5 years to three years to onboard a customers. In Railway division, it’s a process of four years minimum if everything goes fine at all the steps and then you become part two and then finally after supplying 300 coaches or three years, then we become part one supplier in railways. In electronics, generally, the contracts are long wish time to from — ranging from three to five years contracts.
Naushad Chaudhary
Okay. Secondly, on the circuit, sir, this is slightly more dated question in terms of — I was just trying to understand what was the incentive for the circuit promoter to sell a majority stake to us at such a attractive valuation. So can you elaborate on that?
Jasbir Singh
It is — there was a — there is an issue of succession and promoter is aging and he thought because he has two daughters. So he was trying to sell it from last 1.5 years and he was meeting many bankers as well as many potential buyers. And finally, when we met him, the deal clicked.
Naushad Chaudhary
Okay. And last, in the RSE components, excess compressor, what other major components we don’t have in our portfolio and any plan to add if we have any
Jasbir Singh
Currently doing about 70% of what goes into air-conditioners. We don’t have refrigerant, we don’t have compressor, we don’t have copper tube, we don’t have aluminum wiring harnesses, many other components we don’t have.
Naushad Chaudhary
And any plan to add those as well or is there a technical barrier?
Jasbir Singh
No, this you know, of course, as a team keep on evaluating which component to buy and which to get into. Of course, as a growth strategy, the teams are already evaluating various options.
Naushad Chaudhary
Sure, sir. All the best. I’ll come back-in the queue.
Jasbir Singh
Thank you.
Operator
Thank you. Ladies and gentlemen, due to time constraints, we have reached the end of question-and-answer session. I would now like to hand the conference over to the management for closing comments.
Jasbir Singh
Thank you. Thank you everyone for joining on the call. I hope we have been able to address all your queries. For any further information, kindly get-in touch with our Head of IR, Ravi or Rohit Singh from our IR team or Strategic Growth Advisors team. And we wish you all a very happy 76th Republic Day in advance. Thank you. Have a great day-ahead.
Operator
Thank you. On behalf of Amber Enterprises India Limited, that concludes this conference. Thank you for joining us. You may now disconnect your lines.