Amber Enterprises is entering a challenging smartphone manufacturing ecosystem that shows signs of market maturation. Oppo, Realme, and OnePlus together sold nearly 39 million smartphones in India in FY26, accounting for 25.7% market-share, representing a steady decline from 41.4 million units and 28.5% market-share in FY24. The premiumization trend has particularly impacted Realme, whose annual shipments have fallen from 18.2 million units in FY24 to 14.4 million in FY26. OnePlus has faced additional challenges, selling just 3.4 million units in FY26 — barely a third of FY24's 10.4 million due to organizational restructuring and increased competition from Samsung and Vivo. Market leader Dixon Technologies earns an Ebitda margin of about 3% in mobile assembly, excluding PLI incentives, significantly higher than the margins Amber expects to achieve.
Amber Enterprises has outlined ambitious production targets for its smartphone manufacturing collaboration with Oppo Mobiles India Private Limited. According to the latest business update call, the company expects to start manufacturing eight million units annually from year one onwards, with volumes scaling up to 14-15 million units in their second year of operations. Commercial production is set to commence by April 2027, with manufacturing taking place in an existing facility under a sublease arrangement. The collaboration will not require PN3 approval, as reported by the company, with the mobile segment described as an 'asset light, high volume and low margin business' by Amber Enterprises. Trial production is scheduled for Q4FY27, with the contract initially beginning with assembly and Surface Mount Technology (SMT) operations, targeting an increase in local value addition from 12 to 13 per cent to 35 to 40 per cent over 5 to 6 years. Management indicated that the smartphone business will initially focus on assembly and SMT operations, with a phased roadmap to move into HDI PCBs and component manufacturing over the next 3–5 years.
The collaboration has drawn mixed brokerage views, with some bullish on growth and diversification benefits while others remain cautious due to margin pressures and competition. Nuvama Institutional Equities called the deal a 'value accretive foray' into the mobile segment, believing it expands total addressable market, reduces current summer seasonality, and brings a ready customer base for its HDI/Flex boards business. PL Capital increased its FY28 EPS estimate by 10% after incorporating the mobile business contribution, estimating revenue/EBITDA/PAT CAGR of 42.3%/33.1%/80.7% over FY26-28E with EBITDA margin contracting by about 100bps to 6.8% by FY28E. However, JM Financial maintained its 'Reduce' rating with a target price of ₹8,100, citing that Amber's foray into smartphone manufacturing via the Oppo tie-up exposes it to aggressive competition, thin margins, and scale-related challenges. Despite the mixed brokerage views, the stock has gained 238% over three years and 186% over five years, with the company currently having a market capitalisation of over ₹28,000 crore.
Amber faces significant margin challenges in the smartphone assembly business compared to established players. JM Financial estimates profit-after-tax margins of around 1%, while Elara pegs them at 1.5%, with Amber expecting margins in the range of 1.5-2%. This compares unfavorably to Dixon Technologies, which earns an Ebitda margin of about 3% in mobile assembly, excluding PLI incentives. The competitive disadvantage stems partly from Dixon's stickier terms of agreement, as its business with Oppo operates under an ODM (original design manufacturer) tie-up with its JV Longcheer, which is more secure than Amber's simple manufacturing agreement. As per JM Financial, this arrangement does not foresee immediate risks to incumbents such as Dixon. However, Amber is betting on higher local value addition to help offset stagnancy in smartphone volumes, with local value addition expected to grow from 10-12% to 35-40% over the next five to six years. Despite the low margins, management believes the segment can generate attractive RoCE of 30–35% supported by high asset turns, low working capital requirements and increasing localization.
Amber Enterprises India announced on Thursday, June 18, that it has entered into a manufacturing collaboration with Oppo Mobiles India Private Limited (Oppo India). According to the company press release, this partnership will see Amber Group manufacture mobile phones for the brands, combining the brands' global product expertise with the Indian partner's manufacturing scale, operational capabilities, and local supply chain strengths. Under the agreement, Amber Group will undertake the manufacturing of mobile phones for the three brands - Oppo, OnePlus, and Realme - in India, with both companies working together on a gradual ramp-up of operations and exploring additional opportunities for future collaboration. As per the latest reports, Oppo India is a licensed manufacturer of mobile phones for these brands in India, with the collaboration representing an important milestone for Amber Group's efforts to expand its manufacturing role and strengthen its long-term growth platform. The deal marks Amber's first step into large-scale mobile phone manufacturing, moving beyond its traditional focus on air conditioners and electronics components into a much larger slice of India's electronics market.
