3 days ago
Pricol Shares Rally: Investors Should Book Partial Gains
Pricol makes vehicle parts such as instrument screens, pumps, switches and plastic components.
Its share price has risen sharply from ₹460 to ₹770.
The company’s sales and profits have also grown quickly.
It has received orders for parts used in several popular cars, scooters and motorcycles.
Pricol plans to spend about ₹700 crore to expand its factories.
Some materials have become more expensive, which can reduce profits.
The company hopes to recover part of these higher costs from vehicle makers.
It also wants to separate its instrument-cluster business into a new company.
Because the shares have already risen and the auto business can go through ups and downs, cautious investors may sell some shares while keeping the rest.
Pricol shares rose from ₹460 to ₹770, delivering nearly 70% since the earlier accumulate call.
FY26 and Q1 FY27 revenue and profit grew strongly, supported by vehicle demand and the acquired polymer business.
The company has won orders for popular models and plans ₹700 crore of capital expenditure over 18–24 months.
Input-cost inflation has pressured margins, although some costs may be recovered from original equipment manufacturers.
The proposed demerger of the DICVS business could unlock value, but approvals remain pending and auto-sector cyclicality poses risks.
- Who
- Pricol and its shareholders; the company’s management is pursuing expansion and a demerger.
- What
- Pricol shares have rallied, while the company reports strong growth, new orders, planned capital expenditure and a proposed DICVS demerger.
- Where
- Pricol’s businesses operate in automotive components, including instrument clusters, control systems and polymer products.
- When
- The shares were discussed on August 29, 2026; the demerger is expected to take the next four quarters, subject to approvals.
- Why
- The rally reflects strong business and earnings growth, but investors face valuation, macroeconomic, input-cost and auto-sector cyclicality risks.
Book Partial Gains
Retain Shares for Upside
Investment approach after the rally
Book Partial Gains
Risk-averse investors have a case for pocketing some gains because the shares have risen nearly 70%, equities face macro pressure, and the auto sector is cyclical.
Retain Shares for Upside
Investors can retain part of their holdings because the valuation is considered reasonable relative to the company’s growth opportunity and future upside may remain.
Growth outlook
Book Partial Gains
Higher input costs, chip shortages and the scale disadvantage against larger global competitors could pressure margins and execution.
Retain Shares for Upside
Strong earnings growth, new orders, planned expansion and the polymer business’s customer additions could allow Pricol to outgrow the underlying auto market.
Demerger potential
Book Partial Gains
The possible value unlocking is not assured because shareholder and National Company Law Tribunal approvals are still pending.
Retain Shares for Upside
Separating DICVS into Pricol Autotech could support focused decision-making, capital allocation, technology partnerships and value creation.
Key facts
- Current share price
- ₹770, around 6% below the all-time high of ₹822 reached on August 20, 2026.
- Previous call
- An accumulate call was given when the shares traded at ₹460, about a year earlier.
- Valuation
- Pricol trades at about 35 times trailing earnings and about 22 times estimated FY28 earnings.
- Planned capital expenditure
- Approximately ₹700 crore over the next 18–24 months: ₹300 crore for DICVS and ACFMS, and ₹400 crore for P3L.
- Business mix
- DICVS contributes roughly 60% of revenue, while ACFMS and P3L each contribute roughly 20%.
- Revenue target
- Management aims to double revenue to ₹8,000 crore by FY31.
- Demerger proposal
- The DICVS business is proposed to be spun off into Pricol Autotech, with shareholders receiving one share for every Pricol share, subject to approvals.
Sources
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