Sahay said LG is well positioned to maintain its growth trajectory as earlier price hikes begin to reflect in earnings over the coming quarters.
He expects Amber Enterprises to post stronger growth from the financial year 2027-28 (FY28) as its mobile manufacturing business scales up. The Oppo joint venture will also start contributing meaningfully by then, improving both revenue growth and profitability.
He added that the company has already implemented price increases across key product categories, which should support financial performance over the next nine months.
Sahay said Amber Enterprises’ expansion into smartphone manufacturing through its Oppo partnership marks an important step. “From next year onwards, 28 onwards, we will start seeing a material contribution in their top line from the Oppo JV,” he said.
According to Sahay, the asset-light structure of the Oppo partnership, where the existing manufacturing facility will be operated on a sublease basis, reduces execution risks. He also expects the mobile business to improve Amber’s return profile, which has historically been impacted by the seasonal nature of its air-conditioner business and lower returns from PCB manufacturing.
Sahay said Dixon Technologies‘ near-term volumes remain healthy even without the expected Vivo joint venture approval. However, he believes the partnership could significantly increase production volumes if approved.
Despite the positive demand outlook, Sahay cautioned that margins are likely to remain under pressure. He attributed this to higher raw material costs and the gradual withdrawal of benefits under the production-linked incentive (PLI) scheme.
Sahay expects leading players in the room air-conditioner market to report healthy first-quarter volume growth. He estimates Voltas‘ sales growth at around 30% by volume, while Blue Star could report 20-25% growth. However, he noted that both companies could face pressure on margins as competitive pricing limits their ability to pass on higher costs.
LG Electronics India, in contrast, has already implemented price hikes of around 14% in air conditioners, along with increases across refrigerators, washing machines and televisions. Sahay expects this pricing strategy to support revenue growth of 12-13% and earnings before interest, taxes, depreciation, and amortisation (EBITDA) growth of around 20%.
Among listed companies in his coverage universe, Sahay’s preferred picks are LG Electronics India and Amber Enterprises, citing pricing power, diversification and improving earnings visibility over the next few years.
For the full interview, watch the accompanying video
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