This multi-bagger stock spikes over 4% as subsidiary forms JV

Shares of Amber Enterprises rallied in early trade on Wednesday, December 27, by as much as 4.5 per cent to the day’s high of Rs 3,177.6 as the company’s subsidiary formed a joint venture entity.

At around 9:36 am, shares of the consumer appliances company traded 2.84 per cent higher at Rs 3127.25 per share.

On Tuesday, after market hours, the company announced that its material subsidiary, IL JIN Electronics, and the owner of the leading brand 'Noise, Nexxbase Marketing, have formed a joint venture company, Stelltek Technologies.

“IL JIN Electronics (India) Private Limited, a material subsidiary of the company, and Nexxbase Marketing Private Limited, Noise Brand, which is a Gurgaon-based company engaged in the business of selling, distributing, marketing, and advertising electronic products including smart watches, earphones, earbuds, headphones, etc. under the leading brand, i.e., NOISE, through offline and online modes, have incorporated a joint venture company, namely “Stelltek Technologies Private Limited,” on December 26, 2023, with a shareholding ratio of 50:50, respectively,” said the company’s filing with the exchange.

The new joint venture entity will engage in the business of manufacturing, assembling, and designing wearables and other smart electronics products.

On a year-to-date basis, the stock has given a return to the tune of 67 per cent, while in the last five years, it has offered a multi-bagger return of 244 per cent.

Besides, the stock is trading at a low valuation with a trailing twelve-month price-to-earnings ratio of 67.4, which is below the industry average.

The consensus recommendation on the stock from 19 analysts is ‘hold’ with a strong 'buy’ from nine analysts.

Earlier in October, despite the company’s muted Q2 show, Sharekhan retained its ‘buy’ on the stock with a target of Rs 3,250 on the premise that it expected the company’s profitability to improve, backed by a better product profile in the room air conditioner (RAC) division, traction in the motors, electronics, and mobility divisions, as well as growth in exports.