Synopsis:
Pricol Limited surged 6% after SBI securities gave a target price of Rs. 816, valuing the company at 32x FY27E EPS of Rs.25.5, and more.
This company’s share, engaged in the business of manufacturing and selling of instrument clusters and other allied automobile components to OEMs and replacement markets, is now in focus after SBI securities gave a target of Rs. 816 per share.
With the market capitalization of Rs. 8,052 Crore, Pricol Ltd’s shares on Wednesday made a day high of Rs.670 per share, a 6 percent increase from its previous day’s close price of Rs. 631.20 per share. The share has given a multi-bagger return of 1,121.7 percent over a period of five years.
SBI Securities on Pricol
SBI securities has given a buy target of Rs.816 from its previous close of Rs.631.20, upside of 29 percent, reflecting a positive outlook on the company’s performance and future prospects.
The brokerage firm has valued the company at 32x FY27E EPS of Rs. 25.5(0.9x PEG). With the expectation of Pritcol’s Revenue, EBITDA and PAT to grow at a CAGR of 31 percent, 33 percent and 36 percent over FY25-27E period with increase in content per vehicle from new product launch and expansion in product by acquisition.
“We like the company due to presence across all leading OEMs and models, expansion of client base, high market share in Instrument clusters, backward integrated manufacturing process, diversification of product portfolio, disc brake emerging as new growth driver, healthy new product pipeline, powertrain agnostic product portfolio, premiumisation in vehicles improving content per vehicle, and critical nature of components,” SBI Securities said.
About the company
Pricol Limited is engaged in the business of manufacturing and selling of instrument clusters and other allied automobile components to OEMs and replacement markets.
The business was started in 1974 and is headquartered in Coimbatore, Tamil Nadu. The company’s product verticals: A)Driver Information and Connected Vehicle Solutions. B) Actuation, Control and Fluid Management System, C) Precision Products. Its major customers include Bajaj, Honda, Hero and Toyota, etc.
Financial highlights: Revenue from operations is Rs.1,007 crore in Q2 FY26, a growth of 51 percent from last year’s revenue of Rs. 669 crore in Q2 FY26. EBIDT grew by 53 percent to Rs 118 crore in Q2 FY26 from Rs. 72 crore in Q2 FY25. It closed a strong Quarter with Net profit of Rs. 64 crore in Q2 FY26, a growth of 42 percent YoY and EPS growth of 42 percent YoY.
Management focuses on doing a capex of Rs. 250 crore and with talks of beginning another capex cycle, aligned with new business opportunities, which is follow up of their target capex of Rs. 8,000 crore by FY31 and capex would be the company’s ongoing item because their sustenance Capex is about Rs. 120 crore to Rs. 150 crore to be done every year, mentioned by Vikram Mohan, MD & chairman.
With the strong quarter results and high Capex of the company to capitalise on opportunities, the company is more likely to give better results in the coming quarters.
Written by Gourav Pratap Singh
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