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In a significant move towards bolstering Printed Circuit Board (PCB) manufacturing in India, Amber Group has inked a Memorandum of Understanding (MoU) with South Korea’s Korea Circuit, a subsidiary of the YoungPoong group. The partnership, facilitated through Amber’s recent venture Ascent Circuits, is poised to enhance the capabilities of Ascent Circuits, a key player in the Indian electronics manufacturing sector. This article explores the details of the collaboration, its potential impact on the market, and the broader implications for Amber Group’s strategic positioning.
Amber Group, a diversified B2B company operating across three business verticals – Consumer Durables, Electronics (EMS), and Railway Subsystems & Mobility, has been making strategic moves to strengthen its position in the electronics manufacturing space. With recent developments, including the acquisition of a majority stake in Ascent Circuits and the subsequent MoU with Korea Circuit, Amber Group aims to become a leading player in the Electronics (EMS) sector, unlocking new business opportunities.
The MoU with Korea Circuit signifies a crucial step in fortifying PCB manufacturing capabilities in India. Korea Circuit, a pioneer in the Korean PCB industry with 45 years of expertise, brings state-of-the-art technology and a diverse portfolio of PCB solutions, including HDI, Flex, Semiconductor substrates, Multilayer, Double-sided, and Single-sided PCBs. This collaboration positions Ascent Circuits to provide comprehensive solutions to the Mobile & Semiconductor industry, contributing to India’s Electronics manufacturing growth story.
The partnership with Korea Circuit not only expands Ascent Circuits’ offerings but also provides a competitive advantage in the Indian market. As Nifty Pharma, Nifty Media, Nifty Realty, Nifty PSU Bank, and Nifty Metal experienced fluctuations, this collaboration diversifies Amber Group’s Electronics (EMS) portfolio, aligning with the ‘Atma Nirbhar Bharat’ vision of the Government of India. The MoU positions Korea Circuit to meet the growing demand in India for electronics, ensuring a reliable and efficient supply chain for its customers.
The strategic MoU follows Amber Group’s acquisition of a majority stake (60%) in Ascent Circuits. This South India-based company specialises in manufacturing Printed Circuit Boards (PCBs), catering to diverse industries such as Aerospace & Defence, Medical, Energy Solutions, Automotive, Telecom, and Consumer Electronics. The acquisition strengthens Amber’s EMS portfolio, promoting local value addition and backward integration into passive components of PCB Assemblies.
Amber Group’s established market position, with a 29.6% share in the domestic refrigeration and air conditioning (RAC) market, adds strength to its ventures. The group supplies to leading brands like Voltas, Panasonic, LG, Daikin, and others, accounting for 75% of the RAC market. The strategic backward integration into the components space, high operating efficiency, and healthy financial risk profile position Amber Group as a key player in the Electronics (EMS) space.
Despite the strengths, challenges exist, primarily related to the seasonal nature of the RAC business, impacting cash flow and liquidity. The working capital-intensive operations, reflected in inventory and receivables, highlight the need for efficient working capital management. However, initiatives to curb electronics imports and improvements in operating profitability are anticipated to mitigate these challenges over the medium term.
In conclusion, Amber Group’s MoU with Korea Circuit, coupled with its recent ventures and strategic acquisitions, marks a significant stride towards fortifying PCB manufacturing in India. This collaboration not only diversifies Amber’s Electronics (EMS) portfolio but also contributes to India’s self-reliance vision. The integration of cutting-edge technology from Korea Circuit positions Amber Group as a leading player in the evolving landscape of India’s electronics manufacturing, offering a robust foundation for sustained growth in the sector.
Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. It is based on several secondary sources on the internet and is subject to changes. Please consult an expert before making related decisions
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