Pricol shares gained 5.73% over the past month on NSE, outperforming the benchmark which declined 1.94% during the period. The stock recorded a traded value of ₹6.63 crore with its free-float market capitalisation standing at ₹5,729.62 crore. Axis Direct initiated coverage on the auto-components manufacturer with a 'Buy' rating and set a target price of ₹935. The target price implies an upside of around 21% from the current market price, while the brokerage had estimated a 22% upside based on its reference price of ₹765. According to reports from The Economic Times, the brokerage expects strong growth through FY29, driven by rising demand for digital instrument clusters, plastics expansion, EV content and global auto orders.
Revenue is projected to increase from ₹3,964 crore in FY26 to ₹6,679 crore in FY29, while EBITDA is expected to rise from ₹469 crore to ₹825 crore during the same period. Net profit is estimated to grow from ₹251 crore to ₹475 crore during the same period. As reported by The Economic Times, the brokerage expects Pricol's EBITDA margin to improve to around 12.4% by FY29, aided by better product mix, localisation, plastics integration and scale efficiencies. Return on equity is projected at approximately 22% in FY29. The brokerage believes the valuation is supported by the company's premium product portfolio, growing exports, improving product mix, plastics integration, and expected benefits from operating leverage.
The plastics business generated around ₹924 crore in revenue in FY26 and was operating at approximately 94-95% capacity in the first quarter of FY27. According to The Economic Times, Pricol plans to invest about ₹400 crore to double its turnover capacity from nearly ₹1,000 crore to ₹2,000 crore, with additional capacity expected to become available from FY28. The business houses instrument clusters, TFT displays, connected-vehicle solutions, e-cockpits, infotainment systems, telematics, battery-management systems and sensors. The separation could improve earnings visibility, sharpen capital allocation and allow investors to value the two businesses independently.
The division, which contributed ₹2,425 crore or about 61% of Pricol's consolidated FY26 revenue, will be transferred to Pricol Autotech. Under the proposed arrangement, shareholders will receive one Pricol Autotech share for every Pricol share held. As reported by The Economic Times, the transaction remains subject to regulatory, NCLT, shareholder and creditor approvals, with completion targeted within 12-18 months. The company's actuation, control and fluid-management systems and precision-products businesses will remain with Pricol.
TFT displays currently have a penetration of only around 7-8% among two-wheelers, which the brokerage expects to double over the next two to three years. According to The Economic Times, this shift towards digital displays, connected clusters and higher electronic content per vehicle could help Pricol grow faster than the underlying automobile market. The brokerage believes the valuation is supported by the company's premium product portfolio, growing exports, improving product mix, plastics integration, and expected benefits from operating leverage.
