Amber Enterprises India Limited (NSE: AMBER) Q4 2025 Earnings Call dated May. 19, 2025
Corporate Participants:
Unidentified Speaker
Jasbir Singh — Executive Chairman and Chief Executive Officer and Whole-Time Director
Daljit Singh — Managing Director
Sudhir Goyal — Chief Financial Officer
Sachin Gupta — Head, RAC Division
Sanjay Kumar Arora — Whole Time Director
Analysts:
Unidentified Participant
Vipraw Srivastava — Analyst
Dhruv Jain — Analyst
Pranay Roop Chatterjee — Analyst
Sonali Salgaonkar — Analyst
Aditya Bhartia — Analyst
Anupam Goswami — Analyst
Nirransh Jain — Analyst
Achal Lohade — Analyst
Abhishek Ghosh — Analyst
Jalaj Manocha — Analyst
Indrajit Agarwal — Analyst
Keyur Pandya — Analyst
Madhav Marda — Analyst
Pulkit Patni — Analyst
Manikanta — Analyst
Presentation:
Unidentified Speaker
The conference is now being recorded. Sa. Sam. Sat SA Sa.
operator
Sam Foreign Ladies and gentlemen, good day and welcome to Q4 and FY25 earnings conference call of Amber Enterprises India Limited. 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 this conference call, please signal an operator by pressing Star then zero on your touchstone phone. This conference call may contain forward looking statements about the company which are based on beliefs, opinions and expectations of the company as on date of this call. These statements are not the guarantees of future performance and involve risk and uncertainties that are difficult to predict.
Please note that this conference is being recorded. I now hand the conference over to Mr. Jasbir Singh, Executive Director, Executive Chairman, CEO and whole time Director of Amber Enterprises India Ltd. Thank you and over to you sir.
Jasbir Singh — Executive Chairman and Chief Executive Officer and Whole-Time Director
Hello. Good morning. On the call today I am joined by Mr. Daljeet Singh, our Managing Director, Mr. Sudhir Goel, our Group CFO Sachin Gupta, CEO of RAC and CAC Division, full time Director and Mr. Sanjay Ara, President of Electronics Division and whole time Director of Region Electronics. We have uploaded quarterly presentation on the exchanges and I hope everyone had an opportunity to go through the same. I am pleased to report FY25 has been a phenomenal year both in terms of the performance and the progression of the company. I am delighted to report our total income crossed rupees ten thousand crore milestone and achieved ROCE of 19.5%.
An affirmation of our long term growth strategy and focused execution. Let me talk about progression. First of all, we sincerely applaud the efforts of Ministry of Electronics and it, MIT and Government of India for launching Electronic Component Scheme. The scheme will be a key catalyst for development of robust component ecosystem, attracting new investment and generating employment in the country. We plan to file an application under the PCB categories and finalizing our CAPEX plan which will be spent in phased manner over the scheme tenure. In parallel, we are also finalizing the land for our new joint venture Korea Circuits.
The expansion of Ascent is progressing well in Hosur for Bare Board PCB with new facility the manufacturing capacity will more than double the journey of Electronics division which began for capturing the technological shift in the AC industry from fixed speed AC to inverter ac. It is evolving as a unique full stack EMS company with PCBA vertical catering to diverse customer segments and Bare Board PCB vertical offering wide range of products including high end HDI and flex PCBs. Further considering the robust Growth potential in RAC Industry we plan to augment component capacity at 3 City within existing plant.
In railways the construction is progressing well for Sidwal’s greenfield facility for H VAC pantry doors and gangways and is expected to commence operations by quarter three. FY26 with regards to Eugene Machinery JV, the construction is progressing well and I’m pleased to announce addition of brakes to the existing product lineup of pantograph, driving gear and couplers Switching to consolidated performance FY25 has been a landmark year with the revenue from operations recorded a robust growth of 48% reaching 9,973 crores, clocking record operating EBITDA of rupees 796 crore, growth of 53% year on year and PAD of rupees 251 crore with outstanding growth of 80% year on year.
As guided two years back, we have achieved the high teen ROCE of 19.5% in FY25 and improvement of 690bps over last year. Net working capital days for the year stood at nine days through the Efficient Working Capital Management. Let me take you through the Divisional performance the Consumer Durable Division which consists of RAC and its components and CAC plus non RAC components. We delivered a remarkable growth of 46% year on year with revenue of 7,329 crore driven by underlying RAC industry growth, conversion of new customers from gas charging to ODM and strong growth in the component business and CAC business.
Blended growth of 46% is led by RAC non RAC vertical with 49% and 31% growth respectively and resultant record EBITDA of rupees 562 crore reflecting growth of 59% over last year. The commercial AC vertical has crossed rupees 200 crore mark and expanded its customer base with new additions reinforcing our market presence. We are optimistic about the growth outlook for the current year. With our strategic focus across the rac, CAC component and non RAC component verticals, we are well positioned to outpace the industry growth by a minimum margin of 10 to 12%. Electronic division moving to Electronics Division I am pleased to report we have clocked stellar growth of 77% with revenue of 2,194 crores for the year surpassing guidance of 55%.
The operating EBITDA more than doubled to 151 crore recording a growth of 119% year on year. The Division this division’s the reported marketable roce is of 26% for the year on the margin outlook, we have traveled the journey of expanding our ebitda margins from 2.8% in 2018 when we started electronics division to almost 7% last year. Looking ahead, we are strategically adding margin accretive applications such as industrials, auto, aerospace and defense with an aim to reach 10 to 12% margin for this division over next two years. Coming to railway division, our third division which is Railway subsystem and Defense, the division reported a revenue of rupees 450 crore with a decline of 6%.
As guided earlier that this will be a muted year on the expected lines owing to the delay in the offtake of the products backed by the strong order book and product portfolio expansion. We remain optimistic of doubling this division’s revenue over the next two financial years. Now let me hand over to Sudhir Goyal, our CFO for the financial highlights.
Sudhir Goyal — Chief Financial Officer
Hello everyone. I am pleased to report a strong performance for quarter four and full year for financial year 25. Let me first take you through the quarterly consolidated financial highlights and the full financial year as well. So full year financial year 25 let me take you through the full year 25 financials revenue for financial year 25 increased to rupees 9973 crore compared to 6729 crore in the previous year recording a significant growth of 48%. Operating EBITDA increased to rupees 796 crore against 519 crores with a growth of 53% year on year. PAT has increased to 251 crores compared to rupees 139 crore in previous year reflecting a noteworthy growth of 80% year on year.
On the ROC we witness a strong performance achieving a ROCE of 19.5% for the year and improvement of 690 basis point over the previous financial year reflecting capital efficiency and robust business fundamentals. On the balance sheet front, net Debt stood at rupees 780 crores against 615 crore. Underscoring our disciplined approach towards capital efficiency. Our net working capital days stood at 9 days improvement of 31% from 13 days through proactive focus on working capital management Quarter 4 Financial Year 25 the consolidated revenue for Quarter 4 Financial Year 25 grew by 34% year on year to Rs.
3754 crores compared to 2805 crore in previous year and operating EBITDA increased to Rs. 314 crore during the quarter compared to 234 crores reflecting a growth of 34%. Please note operating EBITDA is before impact of ESOP expenses and other non operating income and expenses. We recorded PAT of 118 crore after the JV loss of 10.4 crore reflecting a growth of 20% year on year. Now let me take you through the divisional performance overview. Firstly, revenue and operating EBITDA Details of the divisional performance are not comparable with published segmental results. The Consumer Durable Division reported revenue of rupees 7329 crores in financial year 25 compared to 5009 crore reflecting a growth of 46% year on year.
On the back of strong RAC and component business, operating EBITDA for the year increased by 59% year on year and stood at rupees 562 crores compared to 353 crores in financial year 24. Coming to electronic division performance, the revenue for the year increased to 2194 crore compared to 12.41crore in previous year reflecting a noteworthy growth of 77% year on year surpassing our earlier growth guidance of 55% for financial year 25. Operating EBITDA for the year increased by 119% year on year and stood at rupees one hundred and fifty one crores compared to 69 crores in financial year 24.
Let me also share the performance of Ascent as it would be of interest. The Ascent recorded the revenue of 325 crore for financial year 25, growth of 24% against full year financial year 24 and maintaining margin profile of 19%. Moving to railway Subsystem and Defence Divisional performance, the division reported a muted year owing to slower offtake. As mentioned earlier, the revenue for the year stood at rupees 450 crores reflecting a decline of 6% and resultant operating EBITDA of rupees 83 crore with a margin of 18.6% impacted due to slower product offtake. To reiterate, we remain optimistic of doubling the division’s revenue over next two financial years.
On the incentive front, we have received the PLI amount of rupees 36 crore for financial year 24. In the current year we expect to receive 49.5 crore under the PLI scheme for the financial year 25. With the expansion of electronic and Railway division, the company is in a transformative growth phase to strengthen the margin profile over next couple of years. Thank you. Now I request operator to please open the floor for the Q and A.
Questions and Answers:
operator
Thank you very much. We will now begin the question and answer session Anyone who wishes to ask a question may press star and one on their 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. Ladies and gentlemen, in order to ensure that the management is able to address questions from all participants in. Please limit your questions to two per participant. Ladies and gentlemen, we’ll wait for a moment while the question queue assembles. The first question is from the line of Viprav Sivastava from Philip Capital.
Please go ahead.
Vipraw Srivastava
Hi. I’m audible, right?
Jasbir Singh
Yes, very audible.
Vipraw Srivastava
Yeah. Great. Results are quickly on the margin expansion which you have guided. So sir, firstly what kind of growth are in this housing for EMS sector for FY26. Any color on that?
Jasbir Singh
Well, we have as explained. We are adding a lot of new applications and that’s the reason why we guided that. We are very confident that this division will be in above 10% range within next two years. Because we are adding industrials and applications more now. And automobile is also adding up. It’s already added. But now the business has growing which are more margin accretive businesses than the current businesses.
Vipraw Srivastava
Sure, sir. And sir, anything on the top line growth?
Jasbir Singh
Top line? We don’t. We can’t tell right now. But yes, I think we are very optimistic of or at least 30% plus growth. 30 to 40% growth range for this division.
Vipraw Srivastava
Sure, son. So last question. On the PCB manufacturing side, which you will be. Which you’re doing for Ascent, that will be the first phase to be operational by FY26, right? That’s 300 crores.
Jasbir Singh
No, no. Ascent circuit is already operational. They have clocked a revenue of more than 325 crores this year. Their expansion in Hosur which was undertaken, that construction is moving well. We expect that construction to be over and the commercial production to start by quarter four of current year by in the month of February or March we will start the production for that new unit which is expansion where we are.
Vipraw Srivastava
Putting 600 crore unit. That’s what you are saying, right? For the full unit, right?
Jasbir Singh
Yes, that’s right. It’s a 650 crore expansion.
Vipraw Srivastava
Yes. Thank you. Thank you.
operator
Thank you. The next question is from the line of Dhruv Jain from Ambit Capital. Please go ahead.
Dhruv Jain
Thanks for the opportunity, sir. Sir, I had one question. On the consumer durable vertical. So obviously we’ve seen that summers have been weak from. You know, because of rains etc. You know FY24 also we faced a situation similar to that so do you think that FY26 will be will decline or the RAC business will be flattish or something like that? Or do you think that in the. Non. AC contribution in durable vertical will be enough to kind of generate double digit growth despite a weak summer? That’s my first question.
Jasbir Singh
If you see we are aggregator of the demands. So yes, there are many news this time that AC is flattish. But just to tell all of you, we have done pretty well in April. May is also going very, very fine for us and we feel that yes, double digit growth is very much possible for Amber’s RAC business. And plus we have added a lot of non RAC components and CAC business which is doing very well.
Dhruv Jain
Great, sir. So the second question that I had was on working capital. So you know, this is another year that we’ve seen very good working capital management. Just wanted to ask is this the new normal? Because if you look at, you know, before FY24 working capital days were far higher. Right. But last two years we’ve seen this or this will normalize, you know, going forward. Just your thoughts. Thanks.
Dhruv Jain
Yeah, Dhruv, you’re right. We used to be in a range of 35, 40 days which is now less than 10, you know, so we feel that this is maintainable. But yes, on a quarterly basis this may not be maintainable because of season and off season basis, but at the year end kind of a thing, we think that yes, it should be in the range of 10 to 15 days on a control level.
Dhruv Jain
Got it, sir. And there’s one question on the JVs, right? So you know, obviously we see losses in the JVs kind of go up.
operator
Sorry to interrupt sir, but I may request you to rejoin the question queue for the follow up questions. Thank you. The next question is from the line of Ankur from HDFC Life. Please go ahead.
Unidentified Participant
Yeah. Hi. Good morning sir. Thanks for your time as always. I have two questions again on the room AC business. One was, you know, and you also did allude to this whole erratic rains which have happened, you know, both in the south now also in the west, especially in the peak summer season. Would you want to take a give us some guidance on how do you see industry volumes kind of playing out for FY26 and more importantly, you know, how do you see the inventory situation at this point in time? You know, given what we understand is in Q4 there was a lot of inventory which was pushed into the system, you know, given issues on compressors, etc.
So one on the inventory situation currently and B on, you know, how do you see the overall industry growth for FY26? So that’s one. And second, you know we also have this new BE rating which I believe change starting January 26th. So impact on industry would you expect? You know typically we see a pre buy right a quarter before that. So would that be something you would also expect this time?
Jasbir Singh
Ankur, you know in last 25 years I have seen many such good seasons and bad seasons. So I request all of you that in case you want to recommend anybody putting in money air conditioners sector, you know, you should not focus on the quarterly basis because this is an industry which is seasonal in nature. And but let me give you numbers. You know, 25 years back, half a million air conditioners used to sell in the country and we have already crossed 14 million mark. You know there are some reports which are referring to 14 million, there are some reports which are referring to 15 million also what we expect that this industry should be in the range of 30 to 35 million in the next five years time which is a good CAGR.
So yes, currently you are right on the south and southern side and on the western side also there’s a lot of rains which are going on. So there are many brands which are struggling to grow and but as I explained that we are aggregator of demand for us April has been very good for us, even May is going pretty fine. You know, on the inventory levels it is varying from brand to brands. There are shortages in some brands till today also and there is surplus inventory with some brands. So as a, as a B2B company for us, what we see from the if I hear from the customers, there are some customers who are slowing down but there are some customers who still continue to be very optimistic and they are growing on their demand I believe.
You know, whenever this kind of season comes, industry normally get into a very pessimistic mode and start planning with a very pessimistic approach. And plus coupled with the Bureau of Energy rating in the month of January. So we expect little offtake in the quarter three which generally is not the case in line to the inventory build up. But that’s the standard patterns of the industry, you know. So there’s no, nothing unique which is going to happen. Whenever there is a positive season you will see industry getting into optimism mode and whenever there is a negative season everybody gets into pessimistic mode.
So it’s a compounding of optimism and pessimism I would say. But on a longer run nothing changes for this sector, we are very optimistic for the complete sector. And plus as Amber since we have diversified our portfolio now, our finished goods contribution today in the whole scheme of console balance sheet is just 40%, 42% which used to be 76% when we got listed. So for us things are very different today because of other divisions doing well and even our CAC and the non RAC components doing well which are not very seasonal in nature.
Unidentified Participant
Right. Okay, great. Understand. Thank you so much.
operator
Thank you. The next question is from the line of Pranayurup Chatterjee from Berman Capital Management. Please go ahead.
Pranay Roop Chatterjee
Thanks for the opportunity. My question was also on the RAC side. So a listed peer of yours reported results and they had about 100% growth in Q4. But. But what they mentioned on a couple of themes in the industry, I thought I wanted to check with you. They mentioned the increased growth is because the outsourcing propensity has started going up again number one. And number two, that the E commerce and modern trade channel white label brands are actively gaining market share and hence they are getting to them as well.
So are these couple of trends that you are also seeing in the market. And hence that would explain the delta. In the growth numbers.
Jasbir Singh
So see the strategy of insourcing, outsourcing continues to shift. But yes, all the plants which were supposed to become they have already been executed by the brands and since last year it was a very good season. So definitely yes, outsourcing concept, the propensity is towards now outsourcing more which was towards insourcing for last two to three years. That’s very right. And on the brands which are like Chroma, Flipkart and other kind of brands, yes, they are also gaining traction. So that does make the outsourcing business model lucrative right now as compared to what it used to be two to three years back.
Pranay Roop Chatterjee
Got it sir. And I just wanted to understand because your commentary on your RSC segment was quite inspiring given the sad Channel 6 calls I’ve been attending. So if you can throw some more color. Is it because you are less indexed. In the south which is probably more. Impacted than other parts of the country? Is it because your customers are doing. Relatively better than the wider industry? Like what could explain the difference in tone of the contract? Manufacturers versus let’s say distributors etc.
Jasbir Singh
No Prabh, I think probably the customers which we are catering to, their demand is growing. So I mean yes, south is down for everybody definitely because of the rains and all. But north is already picked up the western part some of the western parts and the central part of India has picked up. There are some rains going on but yes, overall the customers which we are catering are moving positive as of now.
Pranay Roop Chatterjee
Thanks a lot sir. All the best.
operator
Thank you. The next question is from the line of Saloni Salgavkar from Jefferies India. Please go ahead.
Sonali Salgaonkar
So morning, this is Sonali and congratulations on a great set of ROCs. The expansion has indeed been quite notable year on year. So my first question is a bit strategic related to the ECMS component manufacturing scheme. I know you alluded to the fact that you will be participating in the pcb. But apart from that is there any other segment which you would like to, you know, even evaluate? And in conjunction of that X of ECMS, what is the FY26 capex? And with ECMS what would you expect that to be?
Jasbir Singh
Well thank you Sonali. I think on the ECMS you know our capex, what we are planning without ECMS our capex will be somewhere about 500 crores which will be for our railway division and the RAC division, Consumer durable division. In ECMS we will be putting in an application of about 3000 crores which is to be spent over a period of scheme in five years. And I think this year the CAPEX will be somewhere about close to about 800 to 900 crores which is ongoing ascent circuit CAPEX because last year only the land came in and now the building and machinery are going to be added up.
Plus the new joint venture Korea circuits, land and some part of the building will come this year. You asked one more question.
Sonali Salgaonkar
Yes. So this was actually just to clarify X of ECMs right now status quo. 500 crores, right?
Jasbir Singh
That’s right.
Sonali Salgaonkar
Correct. So my second question is regarding Sidwal. Now we understand that the order book has grown to about 20 billion plus which is actually a very encouraging number. We understand FY25 was a bit weak across the railway stocks. Not just with us but across multiple other sectors. But what gives us the confidence of doubling the revenue over the next two years? Is it just the order book or the visibility into any other new categories that we are going into?
Jasbir Singh
Sonali? Yes. I mean one is the slowdown which was there for Vande Bharat and Metro that is picking up the pace. That is first part. Second is our expansion into various product categories like couplers, pantograph, brakes, gears and also doors and gangways. Just to inform you all we have already executed 26 new trains with the gangways. So that product has started going up and we have Received more than about 500 crore of orders for the doors as well. And we have just recently last week received our first order for the couplers as well. So all these addition of our bill of material in the rolling stock is gaining traction.
And that’s why we are confident of reaching to a double number of this division in next two years.
Sonali Salgaonkar
Understood sir. Sorry. And in ECMs question, just one follow through. Is there any other segment which you would like to evaluate apart from the PCB board?
Jasbir Singh
No, we will be very focused in the pcb. So in PCB there are two categories. Ascend circuit is into multi layer and double layer categories. And on the on the Korea circuit side we will be filing application for the high density interface and substrates category.
Sonali Salgaonkar
It’s very helpful. Thank you sir. And all the best to the team. And congratulations once again.
Jasbir Singh
Thank you sir.
operator
Thank you. The next question is from the line of Aditya Bhartia from Investec. Please go ahead.
Aditya Bhartia
Hi. Good morning sir. So my first question is on the electronics business wherein we saw very strong growth in fourth quarter. Clearly there’s a lot of momentum that the segment is picking up. Just wanted to understand are there any new segments that we have commercialized within the EMS space? Any new large customers that you can speak about?
Jasbir Singh
Well, I’ll not give a color on the customers because of the NDA sign. But yes, on the application side I’ll give you a brief. When we started in 2018, we had just started for consumer durable particularly ranging in air conditioners and refrigerators. But today we cater to variable wearable segment, we cater to smart meters segment, we cater to automobile sector, we have defense applications and telecom. These are the sectors which we are already catering to. What we are going to add in next two years is industrials and aerospace and defense.
Aditya Bhartia
And this pickup in growth that we get to see in fourth quarter, sir, is it on account of any like in automobiles maybe become us becoming larger or on variables and hitables getting much larger orders than what we used to. If you could just kind of give some indication around that.
Jasbir Singh
We are gaining traction in almost every vertical basically. And you know I think we are very optimistic for this division. And as normally what happens is there are entry barriers of two to three years or maybe sometime in four years also depending on customers. And in the year one or two we get less share of business. But as we move older, you know we gain traction and we can gain the more share of business also. So that’s how the trajectory has been now.
Aditya Bhartia
Understood sir. And my last question is on the capex that you spoke about for the electronics business almost at 3000 crores over 5 years. Is that roughly how we are going to file the application is bulk of that on the BAPCD side. And how exactly is this capex likely to be split across different entities within the electronics system?
Jasbir Singh
It will be spread in you know, three categories. Pcba, pcb, Ascent circuit which we are already doing and courier circuit, our new jv. So this will be in three categories but the application which will go in the new scheme will be only for the PCBs because PCBs are not allowed in that scheme. So large capex is going 3000 crore capex will come in that category which is going to be spread over five years. But we should clearly note that you know in one scheme the 48% is going to be returned by through over a period of five years by government and above than that the state government’s incentives of close to about 35% are going to kick in.
So net capex for us out of that 3,000 crore which we will invest in after five years the net capex which will come in the balance sheet will be just 25 to 30% of the whole 3000 crores.
Aditya Bhartia
Understood sir. And this will be.
operator
Sorry to interrupt sir but I am a request to rejoin the question queue for follow up questions. Thank you. The next question is from the line of Anupam Goswami from Sud Life. Please go ahead.
Anupam Goswami
Hi sir, good morning. So my first question is on the electronics division. If you can give a little light on what are we currently doing and where are we moving towards and what kind of a market we can look at in that perspective. Also in your railway division so you said about 2x of your doubling the revenue but little on the more longer time horizon. Again what sort of TAM are we looking and what are the projects we are currently working on and what would qualify to go more into this. That is also.
Jasbir Singh
Good morning. On railway division, you know earlier we were just catering to 25 lakh rupees in one passenger car. So normally a Vande Bharat Express has got 16 passenger cars and one passenger car is costing about 6 to 6.25 crores. Out of that we were catering only air conditioner part but now we can cater to 1.5 crores of what goes into it as we added into pantries plus doors and gangways, couplers, brakes and you know cares. So our TAM has expanded by five times while being in the same segment for metro and railway. That is one part.
And on the electronic side, you know PCB coming on the. What we do in the electronic side, we do two parts in the electronic side. First is we give PCB assemblies for various sectors such as consumer durables comprising of air conditioners, inverter, PCB boards, refrigerator electronic boards, washing machine boards, microwave boards, water purifiers and also some small appliances. That is our consumer durable catering. Then we do smart watches, Bluetooth speakers. As a hearable wearable segment we do smart meters. Then we do automobile telematics and other categories of products for two wheeler and four wheelers and large commercial vehicles also.
And we do some optoelectronics for the defense applications also. And telecom also we are doing 4G 5G equipments. So this is our PCBA application site and we are a backward integrated company with the PCB also in house. We do single layer, multi layer, double layer and radio frequency PCB up to 48 layers currently. But what we are adding now apart from this capacity is the HDI and semiconductor substrates which is required in mobile phones and laptops and its and servers etc. So this is going to be added in next two years.
Anupam Goswami
So just on the follow up, what sort of revenue or market that we can look at from this new segment?
Jasbir Singh
Well, it’s a very big time. Just to explain about PCB itself. Last year India almost consumed $115 million of electronics out of which $4 billion of PCBs. Almost about 32,000 crore of PCBs got consumed in India and only 9% of that got manufactured in India. And looking into these data points, Government of India has already supported the sector by anti dumping duty up to six layers which has gained lot of momentum for bringing up capacities in the country. And now what we see in next five years the industry electronics consumption in India will go to almost about 300 to $400 billion.
And as a thumb rule 3.5 to 4% is the PCB consumption. So there is a time of about $10 billion of consumption. Even if we assume that 50% will still be imported at that time. Still there is current level of 3,000 crore worth of PCB getting manufactured going to almost about $5 billion. So that’s the opportunity size and we expect to at least have 10% of this opportunity size moving forward.
Anupam Goswami
All right sir, thank you. I’ll join back in the queue.
operator
Thank you. The next question is from the line of Narish Jain from BNP Paribas. Please go ahead.
Nirransh Jain
Yeah. Hi sir. Good morning. Thank you for the opportunity. Sir. My first Question is just some clarity on the capex numbers. So you have highlighted 3000 crores under this ECMS scheme to be spent over 5 years. So this would be for both the Korea circuit JV as well as for the ascent circuit. Right. So is there any breakup on how much are we planning to expand the ascent circuit over and above the 650 crore capex that we have already like which is already undergoing.
Jasbir Singh
So currently we have announced 650 crore capex which is ongoing. Maybe we add looking into the demand scenario we may add moving forward after two to three years time another 500 crores in this and rest is the courier circuit CV. Okay and just to just to inform you all we should note one more point which is I would like to highlight that we have been able to successfully sign off take agreement with the Korea circuits where first two years of the production capacity will be taken to Korea Circuits by Korea Circuits team to their existing customers from India.
So as we start the process, you know we don’t have any issues on the customer side.
Nirransh Jain
Great sir, moving to the second question, I just actually want to get a bit more detail on the on the commentary regarding the like next year expectation for output pacing the RAC industry growth. By 10 to 12%. So generally the question stems from the fact that considering that it’s at least a weaker summer than what we had anticipated at the start of the year, even if it is delayed, but there is still a higher inventory at the dealer and brand level and now over the years at least more and more capacities have also been set up at the brand level.
So what gives us the confidence that we’ll gain market share in terms of especially if there’s a like the growth. Is low then obviously the brands would. Be looking more for in house sourcing for their new capacity setup. So how are we looking to outpace the growth? Can you just share a bit more. Color on this,
Jasbir Singh
see if I see the results of all the listed players. I have seen documentaries around growth phase of 25 to 30% whereas Amber has grown by more than 48%. So that’s a testimony of our aggregation of the demand kind of scenario. We believe because we’ve added new customers last year, that is one part. Second is we’ve added some customers on the components of RSE as well and you know we are growing in the CSE part also. So these all three factors are leading us to comment that we will outpace the industry by at least 10%.
Nirransh Jain
Great sir. And lastly just CAC already did 200 crores for us. And like what is the expectation for this business? Like how much can we expand it from here onwards?
Jasbir Singh
It’s growing pretty well. We started this division two years back and it has crossed 200 crores this year. We expect this division to grow at least by 2025 to 30% range this year.
Nirransh Jain
Great. Great, sir. Thank you. And all the best. Congratulations again.
Jasbir Singh
Thank you.
operator
Thank you. The next question is from the line of Mr. Achal Lohade from Nuvama Institutional equities. Please go ahead.
Achal Lohade
Yeah, good morning team. Thank you for the opportunity. Congratulations for good numbers. So just wanted to check on the. The JV losses. You know, if. If you could give some sense in terms of what has driven this increased losses and how do we see it over next couple of years?
Jasbir Singh
Well, you know, these businesses take time for ramping up. This is a new business for us, both of them. And I think we are very confident that as we move ahead we’ll be able to take care of these losses. And the larger objective of getting into joint venture along with the theta gut was particularly for, you know, gearing up for our new component sectors which are the new categories which we have added because these are very high entry barrier businesses. So if you, if you want to supply products like doors and gangways or brakes or couplers, these are safety level two and safety level four products where the entry barriers are as good as seven to eight years.
So our main objective of this JV was to get into that and which we have already received and we are very happy that on signing itself we were able to receive a substantial business from Ditagarh India as well as abroad. Yes. Outside JV is struggling at the moment but we feel we should be able to come out of that very soon.
Achal Lohade
Any number you want to throw, sir, for FY26 like we had 30 crores of loss. For FY25, could we see a breakeven or we’ll see substantial reduction and break even in FY27.
Jasbir Singh
I think it’ll little. It should come down by another 10 crore or so. So 20 to 25 crore should be the range moving forward.
Achal Lohade
Got it. And just to clarify, you mentioned that for the rac, whatever is the industry growth will outpace the industry growth by 10 to 12 percentage points. Have I understood right, sir?
Jasbir Singh
That’s right. Yes.
Achal Lohade
Perfect. All right. So thank you so much. I’ll fall back.
Jasbir Singh
Thank you for following.
Achal Lohade
Thank you.
operator
Thank you. The next question is from the line of abhishek ghosh from DSP. Please go ahead.
Abhishek Ghosh
Good morning sir. Just two questions. In terms of the proposed PLI component scheme where you will be participating for about 3000 crores of outlay, what is the expected return on capital on that investments or on that project? How should we look at it?
Jasbir Singh
Well if you see out of 3000 crore almost 60 to 65% will be funded back in the scheme by Stentor and the state government together. So we’ll be in the net capex side. We will be investing about 30% of that. So 30 to 35%. If I see on the net capex side the ROC level for this industry is more than 25 in the range of 25 to 30%.
Abhishek Ghosh
Okay sir. So for that 3000 crores which you’ll be investing, is it fair to assume that you’ll have an asset turn of maybe like 1 1.5x? How should we look at it?
Jasbir Singh
Generally like to like these are asset heavy businesses. So single layer and double layer they are at asset turn of 1.15 and HDIs are at asset turn of 0.85 to 0.9. But if you see on the net capex invested the asset turns will be more than two. Yeah that is true. And with margin profile of almost like 10, 10 to 12%. No it is these are the businesses in the range of 18 to 20%.
Abhishek Ghosh
Got that. Thank you so much. And so the other question is in terms of the EMS division you have called out that the margin trajectory can be double digit given the change in product mix. So will that be a gradual improvement from here on? Because this quarter we have seen some softening of margins despite a very strong top line growth or is it going to be more like back ended? Just from your thoughts
Jasbir Singh
till now, if you see in our 2200 crore of the electronics division almost 55% is still coming from the consumer sector. So these are the sectors with the low EBITDA margins, you know hairable variable consumer durables.
These are low EBITDA margins. What we are adding is automobile industrials, energy sector and the defense sector. That is what we are adding and that is why we are very confident that the trajectory will go beyond 10%. And I would like to also highlight that this division of ours is at 26% ROCE currently, you know and which is a very healthy current level. I was expecting personally I was expecting that we will cross 7.5 to 8% in this division but it has come down to 6.9% because more of consumer durable applications were sold. But as I hear from the team moving Forward in next four quarters and next eight quarters they are adding lot of customers from industrial side.
And that is why we are confident of bringing up to 10% plus EBITDA margins of this division. Great sir, wish you all the best for that. Thank you so much.
operator
Thank you. The next question is from the line of Jalaj from Swan Investments. Please go ahead.
Jalaj Manocha
Hello. Hope I’m audible.
Jasbir Singh
Yes you are audible
Jasbir Singh
sir. First of all congrats on a great set of numbers. Sir, I had two, three questions. The first one was could you give us some idea as to what sort of effects are we planning to put in the Kohea daily And what sort of timeline should we understand for the plan to get online and the revenue starting to photo as skin.
Jasbir Singh
So in Korea Circuit JV we will be putting in application of close to about 2500 crores which is to be spent on period of 5 years. And timeline is that as per government, government has given 90 days time to file an application. After that I am assuming that another 60 days or so for approvals and that’s when the approvals will be granted. So post September the work will start. So I am hopeful that by next financial year quarter four it should be up and running.
Jalaj Manocha
Understood? Understood. And sir, this was the second question was with regards to Sidwal. So we have been talking about the longer gestation period along with a lot of time period to develop the product. But how is the exports division or the exports portion shaping up there? And when should we expect something tangible coming into the PNL or otherwise?
Jasbir Singh
We have started participating in RFQs for the export tenders at the moment we have received our first developmental order from New York and we expect that after. So the process is pretty long. You have to supply the products in next 24 months. After that they will watch and monitor the performance for next 18 months. After that you are approved for supplies. So it is a process. I think another three years time from now on. But the process has started, teams have been formed and we have started working. And also I would like to highlight that through Indian rolling stock companies who are participating in the foreign tenders.
Through them also it will be a deemed export for us. That has also started.
Jalaj Manocha
Understood? Understood. And one last question.
Indrajit Agarwal
Sorry to interrupt sir, but I may request you to rejoin the question queue for follow up questions. Thank you. Sir. The next question is from the line of Indrajit Agarwal from clsa. Please go ahead.
Indrajit Agarwal
Hello, can you hear me?
Jasbir Singh
Yeah, Indrajit. Audible.
Indrajit Agarwal
Hi sir, thank you for the opportunity and congratulations on a robust Guidance. I have one question on the guidance on the electron. Now on the railway side as you. Mentioned doubling in the next two years. Would it be more back ended? Would we see more growth in FY27 and 28 or 26? You expect to be strong as well as per the order book that we have today.
Jasbir Singh
So FY26 will be slight growth over the period of last year because now the projects have started taking off. And if you just to tell you that the Vande Bharat Express 200 Vande Bharat Express which were to be rolled out two sets both TMH and Thetagarh they were supposed to be last year which got delayed by a year. So that is happening this year. But the large numbers will start going from next year. So you will see a big traction next year onwards.
Indrajit Agarwal
Sure. And secondly on the washing machine resource part when do we see revenue accrual for us?
Jasbir Singh
So we have already supplied 28,000 washing machines this year. So revenue has started getting accrued. But we are having some losses there. I think the team is already working and maybe this year we plan that the number should be at least at a breakeven point.
Indrajit Agarwal
Sure. Thank you so much.
operator
Thank you. The next question is from the line of Kur Pandya from ICICI Prudential Life Insurance. Please go ahead.
Keyur Pandya
Thank you. One question on the electronics side. So considering what is the capacity available in Ascent and in Backdrop, what would the growth drive for FY26 for the overall electronics division both in terms of revenue profitability as well as working capital?
Jasbir Singh
Well currently Ascent is moving at almost 90% of capacity. And that’s why we are Putting up another 30,000 square meter plant and Korea circuits will be the first phase. Will be 10,000 square meter of HDI to begin with. And then we’ll keep on adding as we move ahead.
Keyur Pandya
So just one follow up. So I mean what will drive this 30 40% growth in FY26? It would be our core EMS business since ascent is fully utilized. And just want to understand on the working capital side or the essence revenue potential of 650 crore. So 650 crore would fetch us 600, 650 crore kind of revenue.
Jasbir Singh
Now on the EMs side since we are adding some applications that’s bringing up the growth. And for the Ascent circuit we see some numbers adding up in the last month of this financial year where the plant will start adding up. But the large number will come from next year in the Ascent circuits number.
Keyur Pandya
Okay. Thank you and all the best.
Jasbir Singh
Thank you.
operator
Thank you. The Next question comes from the line of Madhav from Fidelity. Please go ahead.
Madhav Marda
Hello. Yeah good morning. Thank you so much for your time. I just wanted to understand a bit on the Korea circuit, the economics. So investing 2500 crores over 5 years could you give us some sense in terms of what could be the peak revenue potential of this project? You did mention the customer mix but if you could give us some sense on the product mix as well how the scale up happens here because it’s a very large project, probably the largest single location capex for Amber in my understanding. So if you could give us some more sense around, you know the ramp up timeline etc that would be great.
Thank you.
Jasbir Singh
Madhav. Yes you it will be like 2500 over period of 5 years so like the first part of that will be about 1000 crores or so. Generally the asset turns in this sector are 0.85 to 0.9 and that’s where we are going to grow. But if you see in a horizon of two to three years time because we have a offtake agreement we feel that it can add about 1500 crores revenue over a period of after we start the production over a period of next two years.
Madhav Marda
So when does the plant commission the thousand crore phase one capex? When does that commission?
Jasbir Singh
So this will commission next financial year quarter four because we, we expect the approvals to come by September and that’s where the construction and everything will start. So it takes about 14 to 15 months for the plant to get commissioned.
Madhav Marda
Okay so quota 4 of FY27. So let’s say FY28 is in, we. Start seeing some
Jasbir Singh
FY28 you will see or the PCB. PCB itself giving a revenue generation of more than 2500 crores at 18 to 20% of EBITDA.
Madhav Marda
Yeah so that’s also margins for this courier circuit JV is about 18 to 20% EBITDA margin.
Jasbir Singh
That’s right. That’s what generally the sector operates at. And they serve very high marquee customers like Micron and Samsung in the HDI category. And that’s where we are already in touch with those customers at the moment.
Madhav Marda
And of this thousand crores we expect about 75% in capex subsidies or this is adjusted for the subsidy.
Jasbir Singh
No, it will be 48% to be reimbursed by MITI through the scheme, by central government and over and above to that. But this 48% is only on plant and machinery land and building is not included in this. Whereas the state governments Give you subsidy of about 35% on entire capex. So on a blended basis if we see it will be about 65% refund.
Madhav Marda
Okay, so effectively 1000 crore capex for us implies 350 crore of adjusted for the subsidy from the government. We’ll have to invest including with the circuit.
Jasbir Singh
Yeah, yeah, that’s right.
Madhav Marda
And then at 350 crores you’re saying we can do a revenue of about 900 crores which is at 0.9 times fixed asset.
Jasbir Singh
Yes, I mean almost near to that.
Madhav Marda
Okay, all right, thank you.
operator
Thank you. The next question is from the line of Pulkit from Goldman Sachs. Please go ahead. Mr. Pulkit, are you there?
Pulkit Patni
Can you hear me? I’m so sorry I was audible. Yeah, yes sir, apologies for that. And my question is in continuation with what Madhav asked. So one is the capex that you’ll do but is there any other sort of revenue threshold etc that you’ll need to meet in order to get this incentive? Secondly, can we just discuss some rough timelines. For example you do this capex now what are the milestones the government would want to see before this subsidy comes to us? And thirdly if there is a time gap between now and then, how are you going to be funding that particular piece?
Jasbir Singh
On the timeline basically and the turnover. So this, it’s a hybrid scheme for capex and TLI turnover linked incentive scheme. So out of 48% 25% will be reimbursed after the plant is commissioned and 23% will come in next five years after object after achieving the turnover linked incentive and employee linked incentives also. So there is employment generation also which we need to do. So once we meet those criteria every year we’ll get will be. It will be spread in 23% will be spread in five years. So that is how the timeline on the, on the subsidies are coming.
Coming to the funding part. You know as a electronics division we are already in touch for raising the funds for. For this kind of, you know, meeting the objective because we are going to get back. So it is. We are already in touch with various institutions for that.
Pulkit Patni
Sure sir. So it will be more like a working capital funding till the time you get the money back.
Jasbir Singh
Capex funding rather than working capital funding.
Pulkit Patni
Yeah, understood, understood. Answers the same would be true for states also Our state has a different mechanism of incentive reimbursement.
Jasbir Singh
Some states like we are already negotiating with two states at the moment and that also has some hybrid part of it. Some portion is given back in first year then remaining is spread in five years time.
Pulkit Patni
Great. Jasvir ji, very clear. Thank you.
Jasbir Singh
Thank you Pulkit.
Manikanta
Thank you. The next question comes from the line of Amit Mahavar from UBS. Please go ahead. Mr. Amit, are you there? We move on to the next participant. It’s Manikantha from Franklin Templeton. Please go ahead.
Manikanta
Yeah, I hope I’m audible.
Jasbir Singh
Yes, audible.
Manikanta
Yeah. Hi. Thank you for giving me the opportunity sir. On just two questions from my side and the electronics division. Again I know that we have not mentioned this in the presentation but wanted to check if we can give any order book for electronics division. Ballpark number by end of 25 and how this would have grown maybe y o y in this year. That’s the first question. And second question is are we incrementally seeing any export opportunities in electronics division given every other B2B company out there is focusing a lot on this exports opportunities. Those are two my questions.
Jasbir Singh
Yeah, because of you know, this tariff, you know, being spoken so much there are many customers who started talking to us for exports and we are talking but let us see. I mean I think we are not giving really great mileage to that. Maybe two years down the line. Yes, we may see some big exports coming. Largely we are focusing on domestic industry at the moment. If I talk about the order book, so generally the contracts are long term in nature. So we’ve already done 2193. If I speak about two years order book, you know we are already sitting at a close to about 5000 crore of order book kind of a thing at the moment from various customers with various applications.
Manikanta
Just to clarify that 5000 crores is equitable over two years is what you are saying?
Jasbir Singh
Yes, that’s right. I mean it keeps on adding up, you know, you keep on delivering and keep on adding up. So it’s a perpetuity kind of orders.
Manikanta
And how this would have grown y o y basis this 5000 crores.
Jasbir Singh
It’s grown pretty well because last year we have done 77%, you know, growth in this division. So it’s grown very well, you know, and pretty and growing very fast as we are adding applications. So it’s. We will see a compounding results after three years in this division.
Manikanta
Got it. Very clear. Thank you so much.
operator
Thank you ladies and gentlemen. We will take that as the last question. I would now like to hand the conference over to Mr. Jasbir Singh for closing comments.
Jasbir Singh
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 Karbanda, or Rohit Singh from our IR team or Strategic Growth Advisors. Thank you very much. Have a good day ahead.
operator
Thank you. On behalf of amber Enterprises India Ltd. That concludes this conference. Thank you for joining us. And you may now disconnect your lines.
Unidentified Speaker
SA.