Target Price: ₹735
Current Market Price (CMP): ₹544.90
Pricol has reported strong performance for Q4FY26, attributed to premiumization in instrument clusters and significant growth in its Actuation, Control, Fuel, and Mechanical Systems (ACFMS) and Pricol Precision Polymer Ltd (P3L) plastics segments.
In FY26, Driver Information Systems, which include instrument clusters, accounted for 60% of the company’s total revenue. ACFMS contributed 20% of the total revenue, with a notable growth of 30% driven primarily by an emphasis on exports. The new Disc Brakes product line is set to begin mass production in the first half of FY27, with a current capacity of 0.5 million units per annum. Meanwhile, demand for the P3L segment remains robust; however, it currently faces capacity constraints.
The company plans to initiate backward integration in its display operations, with production expected to start within 10 to 12 months. Additionally, revenue from its partnership with Domino, which focuses on two-wheeler throttle and switch components, is anticipated to begin contributing in 18 to 24 months.
Nonetheless, Pricol has faced substantial input cost inflation affecting polymers, aluminum, semiconductors, and freight. These challenges have exerted pressure on margins due to a delayed pass-through effect to original equipment manufacturers (OEMs). The outlook for FY27 remains cautious, characterized by limited visibility, slower growth, and continued margin pressures stemming from macroeconomic and geopolitical conditions, which are affecting the industry as a whole.
Currently, Pricol’s stock is trading at a P/E ratio of 24.0x for FY27E and 16.4x for FY28E earnings per share (EPS) estimates of ₹23 and ₹33.7, respectively. In response to anticipated margin pressures in H1FY27E, the target price has been revised down by 10% to ₹735, reflecting adjustments in FY27E earnings growth expectations.
Published on May 19, 2026
