Pricol shares rise 4%; buy stock for 22% upside, says Axis Securities
Pricol is an automotive component manufacturer specialising in instrument clusters, driver information systems, sensors, pumps and telematics solutions.
- Sep 7, 2026,
- Updated Sep 7, 2026 2:07 PM IST
Shares of Pricol Ltd climbed 4 per cent in Monday's trade amid a 'Buy' call from Axis Securities. The stock gained as the brokerage suggested a target of Rs 935 on Pricol, implying 22 per cent upside over Friday's closing price. The brokerage sees the proposed demerger of the company's Driver Information & Connected Vehicle Solutions (DICVS) business, growth in premium automotive components and expansion of its plastics business, as key growth drivers.
The brokerage said: "Pricol's strong position in instrument clusters, rising electronic content in vehicles and increasing adoption of electric vehicles could support growth, while its recent plastics acquisition adds another avenue for diversification."
Following the development, the stock rose 3.90 per cent to hit a high of Rs 782.70 on BSE.
Demerger could unlock value
Axis Securities considers the proposed demerger of Pricol's DICVS business into Pricol Autotech Ltd to be the key strategic catalyst. DICVS contributed Rs 2,425 crore, or 61.2 per cent, of Pricol's consolidated revenue in FY26 and houses instrument clusters, displays, connected vehicle solutions, infotainment, telematics and sensors.
Under the proposed scheme, shareholders will receive one Pricol Autotech share for every one Pricol share held, subject to regulatory, shareholder and other required approvals. Axis Securities believes separating the businesses could improve capital allocation and allow investors to value the two platforms independently.
"The separation could unlock value by enabling investors to apply business-specific valuation multiples based on differing growth profiles, margins, capital intensity and addressable markets," the brokerage said.
The brokerage expects the demerger to improve earnings visibility and potentially reduce the valuation discount currently applied to the company as a diversified business. Completion is expected to take at least four quarters, with management internally targeting around 12-18 months, subject to approvals.
Strong position in automotive components
Pricol is an automotive component manufacturer specialising in instrument clusters, driver information systems, sensors, pumps and telematics solutions. It supplies more than 5,200 product variants to automotive original equipment manufacturers (OEMs) across two-wheelers, passenger vehicles, commercial vehicles and off-highway vehicles.
Axis Securities estimates that Pricol has around 75-80 per cent share in two-wheeler TFT clusters, while TFT penetration remains only around 7-8 per cent of two-wheelers. The brokerage expects the shift towards digital displays, connected clusters, infotainment, telematics and sensors to increase the value of components fitted in each vehicle.
The company's portfolio is also increasingly applicable across both conventional internal-combustion-engine and electric-vehicle platforms. Pricol has secured electric-vehicle programmes with Ather Energy, TVS Motor, Honda, River, Simple Energy and Raptee.
Plastics business adds another growth driver
Axis Securities also highlighted Pricol's Rs 215 crore acquisition of the injection-moulding business of Sundaram Auto Components. The business generated around Rs 924 crore in revenue in FY26, while first-quarter FY27 revenue stood at around Rs 249 crore and capacity utilisation was already around 94-95 per cent.
Pricol plans around Rs 400 crore of polymer-related capital expenditure, which is expected to increase turnover capacity from around Rs 1,000 crore to Rs 2,000 crore. The brokerage expects meaningful capacity relief from FY28.
Target price
Axis Securities expects Pricol's revenue, Ebitda and profit after tax to grow at 19 per cent, 21 per cent and 24 per cent annually, respectively, between FY26 and FY29. The brokerage expects growth to be supported by premium products, electric-vehicle-compatible components, plastics integration, operating leverage and new global automotive programmes.
"We initiate coverage on the stock with a BUY rating and assign a forward P/E multiple of 24x on FY29E EPS to arrive at our target price of Rs 935/share," Axis Securities said.
Shares of Pricol Ltd climbed 4 per cent in Monday's trade amid a 'Buy' call from Axis Securities. The stock gained as the brokerage suggested a target of Rs 935 on Pricol, implying 22 per cent upside over Friday's closing price. The brokerage sees the proposed demerger of the company's Driver Information & Connected Vehicle Solutions (DICVS) business, growth in premium automotive components and expansion of its plastics business, as key growth drivers.
The brokerage said: "Pricol's strong position in instrument clusters, rising electronic content in vehicles and increasing adoption of electric vehicles could support growth, while its recent plastics acquisition adds another avenue for diversification."
Following the development, the stock rose 3.90 per cent to hit a high of Rs 782.70 on BSE.
Demerger could unlock value
Axis Securities considers the proposed demerger of Pricol's DICVS business into Pricol Autotech Ltd to be the key strategic catalyst. DICVS contributed Rs 2,425 crore, or 61.2 per cent, of Pricol's consolidated revenue in FY26 and houses instrument clusters, displays, connected vehicle solutions, infotainment, telematics and sensors.
Under the proposed scheme, shareholders will receive one Pricol Autotech share for every one Pricol share held, subject to regulatory, shareholder and other required approvals. Axis Securities believes separating the businesses could improve capital allocation and allow investors to value the two platforms independently.
"The separation could unlock value by enabling investors to apply business-specific valuation multiples based on differing growth profiles, margins, capital intensity and addressable markets," the brokerage said.
The brokerage expects the demerger to improve earnings visibility and potentially reduce the valuation discount currently applied to the company as a diversified business. Completion is expected to take at least four quarters, with management internally targeting around 12-18 months, subject to approvals.
Strong position in automotive components
Pricol is an automotive component manufacturer specialising in instrument clusters, driver information systems, sensors, pumps and telematics solutions. It supplies more than 5,200 product variants to automotive original equipment manufacturers (OEMs) across two-wheelers, passenger vehicles, commercial vehicles and off-highway vehicles.
Axis Securities estimates that Pricol has around 75-80 per cent share in two-wheeler TFT clusters, while TFT penetration remains only around 7-8 per cent of two-wheelers. The brokerage expects the shift towards digital displays, connected clusters, infotainment, telematics and sensors to increase the value of components fitted in each vehicle.
The company's portfolio is also increasingly applicable across both conventional internal-combustion-engine and electric-vehicle platforms. Pricol has secured electric-vehicle programmes with Ather Energy, TVS Motor, Honda, River, Simple Energy and Raptee.
Plastics business adds another growth driver
Axis Securities also highlighted Pricol's Rs 215 crore acquisition of the injection-moulding business of Sundaram Auto Components. The business generated around Rs 924 crore in revenue in FY26, while first-quarter FY27 revenue stood at around Rs 249 crore and capacity utilisation was already around 94-95 per cent.
Pricol plans around Rs 400 crore of polymer-related capital expenditure, which is expected to increase turnover capacity from around Rs 1,000 crore to Rs 2,000 crore. The brokerage expects meaningful capacity relief from FY28.
Target price
Axis Securities expects Pricol's revenue, Ebitda and profit after tax to grow at 19 per cent, 21 per cent and 24 per cent annually, respectively, between FY26 and FY29. The brokerage expects growth to be supported by premium products, electric-vehicle-compatible components, plastics integration, operating leverage and new global automotive programmes.
"We initiate coverage on the stock with a BUY rating and assign a forward P/E multiple of 24x on FY29E EPS to arrive at our target price of Rs 935/share," Axis Securities said.