Summary
Pricol Limited - Q3 FY26 Earnings Call Summary Monday, February 2, 2026 04:00 PM IST
Event Participants
Executives 4 P.M. Ganesh (CEO & ED), Priyadarsi Bastia (CFO), Purvangi Jain (Valorem Advisors), Siddharth Manoharan (Director of Strategy)
Analysts 9 Akhilesh Rawat (Ridhanta Vision), Aman Agarwal (Carnelian Capital), Chaitanya Hardikar (Purnartha PMS), Jyoti Singh (Arihant Capital), Karan Gupta (ACM IIL), Kush Nahar (Electrum PMS), Mitul Shah (Pantomath Financial Services), Rahul Deshmukh (LKP Securities), Vijay Pandey (Nuvama), Zubin Pruseth (Karma Capital)
Financials & KPIs
| Metric | Reported | Commentary |
|---|---|---|
| Revenue from Operations | ₹1,000+ crores | +65.67% YoY; Management highlighted crossing the thousand-crore milestone in a single quarter. |
| EBITDA | ₹125 crores | +59.44% YoY; Margins remained steady at 12.19% for the quarter. |
| PAT | ~₹62.4 crores | +6.24% growth YoY; Steady profitability maintained despite increased employee costs. |
| EPS | ₹5.22 | Increased from ₹3.40 in Q3 FY25. |
| 9M FY26 Revenue | ₹2,900 crores | +54.42% YoY; Reflects robust growth and successful integration of acquired businesses. |
| 9M FY26 EBITDA Margin | 12.11% | Consistent with long-term margin profiles. |
| Engineering/R&D Spend | 4.5% of Revenue | Sustained investment to position the company as a technology-first player. |
| Export Revenue Mix | 10% | Steady growth of 15% in the ACFMS export segment despite global macro conditions. |
Geographic & Segment Commentary
- Pricol Precision (P3L - Polymers): Revenue stood at ₹233 crores for Q3 with an EBITDA margin of 9.33%. The segment is currently operating at over 90% peak capacity, prompting a new plant commission and fresh capital investment for capacity expansion.
- Actuation Control & Fluid Management Systems (ACFMS): This segment contributes approximately 25% of total consolidated revenue. The division saw 15% YoY export growth, driven by mass production for global clients like Caterpillar in the US and Europe.
- Driver Information Systems (DIS): Growth continues in tandem with the overall company growth rate. The focus is shifting toward integrated telematics and “E-Cockpit” proof-of-concepts, with samples currently under validation by passenger vehicle OEMs.
Company-Specific & Strategic Commentary
- Supply Chain De-risking: Management confirmed they have completely de-risked from the Nexperia (China) crisis by developing and gaining customer approval for alternate passive components.
- BOE Partnership: Signed an exclusive MOU with BOE (Hong Kong/China), the world’s largest display maker, for backward integration of LCD and TFT modules. Investments are slated to begin in 3-4 quarters with production in 4-5 quarters.
- Product Diversification: Entering the high-growth disc brake market with a 0.5 million unit capacity; mass production for a large Indian two-wheeler OEM is scheduled for Q1/Q2 FY27.
- Technological Evolution: Developing Battery Management Systems (BMS) for premium two-wheeler customers, with mass production expected in the next 4-5 quarters following current testing phases.
Guidance & Outlook
| Metric | Guidance / Outlook | Commentary |
|---|---|---|
| CAPEX | ₹400 - ₹500 crores | Planned over the next 2-3 years, primarily for the Polymer division and new product tooling. |
| Top-line Growth | 15%+ (Directional) | Management aims to continue outperforming industry growth (8-9%) through new product launches. |
| Funding | Internal Accruals | All planned CAPEX is expected to be met through internal cash flows; no long-term debt planned. |
| Margin Profile | Steady State | Management expects to maintain current EBITDA levels while aiming for 10.5% in the P3L segment. |
Risks & Constraints
| Risk | Context |
|---|---|
| Capacity Constraints | Pricol Precision is currently stretched at 90%+ utilization, which might temporarily hamper growth until the new plant is commissioned. |
| Working Capital Costs | Finance costs increased in Q3 due to higher working capital usage necessitated by rapid sales growth. |
| Commodity Volatility | While 100% indexed to customers, there is a 3-to-6-month lag in recovering costs like the recent silver price surge. |
Q&A Highlights
New Product Timelines
- Question: When will the new products like disc brakes and BMS contribute to revenue? (Kush Nahar)
- Answer: Disc brake production for a large OEM starts in Q1/Q2 FY27. BMS is in the testing phase with a premium customer, with mass production expected in 4-5 quarters (P.M. Ganesh).
Pricol Precision Margins
- Question: What impacted the P3L margins (9.33%) vs the 10.5% aspiration? (Aman Agarwal)
- Answer: The business was acquired at a much lower margin; current levels reflect steady improvements in efficiency and manpower. Optimal margins will be reached as fixed cost absorption improves with new capacity (Siddharth Manoharan).
Labor Law Impact
- Question: How is the new labor code affecting employee costs? (Preet)
- Answer: There is no significant impact on Pricol’s direct employees as these costs were factored in previously; however, contract labor impacts are still being evaluated through March (Priyadarsi Bastia).
Key Takeaway
Pricol Limited delivered a landmark quarter, crossing the ₹1,000 crore revenue threshold for the first time with a robust 65.67% YoY growth. The performance was driven by strong demand across the two-wheeler and commercial vehicle segments and the successful scaling of the Pricol Precision (polymer) business, which now contributes ₹233 crores quarterly. Strategically, the company has pivoted toward high-value electronics, evidenced by the exclusive BOE partnership for display localization and the completion of de-risking from Chinese component dependencies. Management remains committed to a ₹500 crore CAPEX plan funded via internal accruals to address capacity bottlenecks in the polymer division (currently at 90% utilization) and to launch new verticals like disc brakes and BMS by FY27. While finance costs rose due to working capital needs, the company maintains a debt-free long-term balance sheet and expects to continue outperforming the broader automotive industry growth.
Want more insights like this?
Subscribe to get deep dives delivered to your inbox.
More Earnings Summaries
Explore more Q3 FY26 earnings call analyses: