Axis Securities has initiated coverage on Pricol Ltd with a BUY recommendation and a target price of ₹935, implying an upside of around 22% from the current market price. The brokerage believes Pricol is well positioned to benefit from the rapid technology transformation in automobiles, particularly the shift towards TFT displays, connected vehicles, e-cockpits, telematics, sensors and higher electronic content per vehicle.
The brokerage’s investment thesis is also underpinned by Pricol’s proposed demerger of its Driver Information & Connected Vehicle Solutions (DICVS) business, which could potentially unlock value by creating two focused and independently managed businesses.
From instrument clusters to intelligent vehicle displays
Established in 1975 and headquartered in Coimbatore, Pricol has evolved from an instrument-cluster manufacturer into a diversified automotive technology and components company.
Its product portfolio spans instrument clusters, TFT displays, sensors, fuel and oil pumps, precision plastic components, telematics, connected vehicle solutions and other electronic and mechanical systems.
Pricol supplies several leading OEMs, including Bajaj Auto, TVS Motor, Hero MotoCorp, Tata Motors, Ashok Leyland and VE Commercial Vehicles.
The company currently operates through three major verticals:
- Driver Information & Connected Vehicle Solutions (DICVS)
- Actuation, Control & Fluid Management Systems (ACFMS)
- Precision Products
This diversification gives Pricol exposure to multiple vehicle segments, including two-wheelers, three-wheelers, passenger vehicles, commercial vehicles, off-highway applications and electric vehicles.
Demerger could be a major value-unlocking catalyst
One of the biggest attractions in the Axis Securities thesis is Pricol’s proposed demerger.
The company has approved the demerger of its DICVS business into Pricol Autotech Ltd., while the ACFMS and Precision Products businesses will remain with Pricol.
DICVS contributed ₹2,425 crore, or 61.2% of Pricol’s FY26 consolidated revenue, making it the company’s largest business.
The division houses some of Pricol’s most technology-intensive products, including:
Instrument clusters | TFT displays | Connected vehicle solutions | E-cockpit | Infotainment | Telematics | BMS | Sensors
Under the proposed scheme, shareholders are expected to receive one share of Pricol Autotech for every one share of Pricol held, subject to regulatory, shareholder and NCLT approvals.
The demerger could create two more focused platforms with greater strategic clarity and independent capital allocation.
Importantly, Axis Securities believes that separating the businesses could enable investors to value the two platforms independently, potentially resulting in better valuation visibility and value unlocking.
Pricol enjoys a strong position in instrument clusters
Pricol’s established position in the domestic two-wheeler instrument-cluster market is another key part of the investment case.
According to Axis Securities, Pricol has an estimated ~40% market share in domestic two-wheeler instrument clusters, while its position is even stronger in TFT clusters, where it commands an estimated 75-80% share.
The transition from conventional analogue displays towards digital and TFT-based clusters is therefore a significant growth opportunity.
As vehicles become increasingly connected and digitally enabled, instrument clusters are evolving into sophisticated information platforms incorporating navigation, connectivity, vehicle diagnostics, entertainment and other functions.
Pricol’s long-standing OEM relationships, proprietary technology, in-house R&D capabilities and high switching costs provide significant entry barriers, according to the brokerage.
Premiumisation is increasing content per vehicle
The rising premiumisation of two-wheelers is another structural growth driver.
Premium motorcycles and scooters increasingly feature larger TFT displays, connected technology, advanced sensors, telematics and integrated cockpit systems.
At the same time, electric vehicles typically have higher electronic content compared with conventional internal-combustion vehicles.
This combination of premiumisation + electrification + digitisation can increase the value of components supplied by Pricol per vehicle.
The company is also expanding beyond instrument clusters into actuation, control, fluid-management and precision products, thereby increasing its addressable market.
₹215 crore plastics acquisition adds another growth engine
Pricol has also strengthened its capabilities in precision plastic components through the ₹215 crore acquisition of the injection-moulding business of Sundaram Auto Components.
The acquired business generated approximately ₹923 crore of revenue and ₹37.4 crore of profit in FY26.
Axis Securities expects this business to potentially double its revenue over the medium term, making it an important diversification and growth driver for Pricol.
The customer base has also expanded beyond TVS Motor to include companies such as Ather Energy, Autoliv, Hanon, Mobis India, Continental and Seoyon Automotive.
This provides Pricol with exposure to both traditional automotive manufacturers and global component suppliers.
Expanding wallet share with major OEMs
Pricol is simultaneously seeking to increase its wallet share with existing customers.
The company is expanding its presence across OEMs including TVS Motor, Bajaj Auto, Hero MotoCorp, Suzuki Motorcycle India, Honda Motorcycle & Scooter India, Yamaha Motor India, Tata Motors and Ashok Leyland.
It is also targeting opportunities with global players such as JCB, Volvo Group, Harley-Davidson, BMW Motorrad and Ducati.
New model launches, increasing localisation and India’s emergence as an export manufacturing hub could provide additional sourcing opportunities.
This gives Pricol the potential to grow not only through existing programs but also through new platforms and global OEM programs.
Q1FY27 growth remains strong
Pricol’s growth momentum remained healthy in Q1FY27, with revenue increasing 23.5% YoY, supported by demand across key product segments.
Axis Securities expects the growth trajectory to remain strong, driven by:
- Increasing penetration of digital and TFT clusters
- Scaling up of the plastics business
- Rising electronic content in EVs
- New global OEM programs
- Premiumisation in two-wheelers
- Increasing exports
- Operating leverage and cost efficiencies
The brokerage expects improving scale and operating leverage to support margins over the medium term.
Axis Securities sees 19% revenue CAGR
Axis Securities estimates that Pricol’s revenue, EBITDA and PAT will grow at 19%, 21% and 24% CAGR respectively over FY26-FY29E.
The expected PAT growth being higher than revenue growth indicates the potential for margin expansion and operating leverage.
FY26-FY29E growth expectations
| Metric | Expected CAGR |
|---|---|
| Revenue | 19% |
| EBITDA | 21% |
| PAT | 24% |
The brokerage expects healthy cash-flow generation alongside earnings growth.
₹935 target price
Axis Securities has valued Pricol at a forward P/E multiple of 24x on FY29 estimated EPS.
Based on this methodology, the brokerage arrives at a target price of ₹935, representing approximately 22% upside from the current market price.
The valuation is supported by Pricol’s leadership in two-wheeler instrument clusters, growing TFT penetration, increasing electronics content, diversification into precision plastics and the potential value unlocking from the proposed demerger.
Investment case: multiple growth engines
Pricol’s investment story is increasingly moving beyond its traditional identity as an instrument-cluster manufacturer.
The company is positioned at the intersection of several structural automotive trends:
Digitalisation: Increasing adoption of TFT and connected displays.
Premiumisation: Higher content per vehicle, particularly in two-wheelers.
Electrification: EVs require greater electronic and sensing content.
Connected vehicles: Growth in telematics, infotainment and connected solutions.
Plastics: Expansion of the precision injection-moulding business.
Exports: India’s emergence as a global automotive manufacturing and sourcing hub.
Demerger: Potential independent valuation and sharper capital allocation for two focused businesses.
Bottom line
Axis Securities’ Pricol thesis is built around a combination of strong market positioning, technology-led content growth, diversification and a potentially significant corporate restructuring catalyst.
The proposed DICVS demerger is particularly important because the business accounts for more than 60% of consolidated revenue and contains Pricol’s key growth areas such as TFT displays, connected vehicle solutions, e-cockpit, infotainment and telematics.
Meanwhile, the Sundaram Auto Components injection-moulding acquisition provides a second growth engine, while increasing EV penetration, premiumisation and global OEM sourcing could drive further content and revenue growth.
With Axis Securities forecasting 19% revenue CAGR and 24% PAT CAGR over FY26-FY29E, the brokerage believes Pricol can sustain strong earnings growth.
Axis Securities has therefore initiated coverage with a BUY recommendation and a target price of ₹935, implying around 22% upside.
This article is based on the Axis Securities research report provided. The views and target price mentioned are those of the brokerage and should not be construed as investment advice.
Pricol Ltd – Initiating Coverage Report – 07092026_07-09-2026_07
