Pricol Shares Scale New Heights with 6% Surge
In a remarkable trading session on Wednesday, Pricol Limited witnessed a substantial surge in its share price, climbing over 6% during early trade and establishing a fresh 52-week high. The small-cap auto component manufacturer's stock rallied as much as 6.14% to reach ₹670.00 per share on the Bombay Stock Exchange, demonstrating strong investor confidence and buying momentum.
The impressive gains were backed by robust trading volumes, with approximately 13 lakh equity shares changing hands on November 19. This figure notably exceeded the stock's average one-week trading volume of 11 lakh shares, indicating heightened investor interest and participation in the counter.
Strong Fundamentals and Market Position
Pricol Ltd stands as one of India's prominent auto component manufacturers, specializing in Instrument Clusters and Fluid Management Systems. The company maintains strategic partnerships with leading domestic original equipment manufacturers across multiple vehicle segments. Its client portfolio includes major players like Bajaj Auto, TVS Motor Company, Hero MotoCorp, and Suzuki in the two-wheeler space, while serving Tata Motors and Force Motors in both passenger and commercial vehicles.
The company has established a dominant market position, commanding more than 40% share within two-wheeler clusters and an impressive over 80% share in the CV and OHV clusters. This market leadership extends to commercial vehicle partnerships with Ashok Leyland, Volvo Eicher, and Daimler, along with off-highway OEMs including Tata Hitachi, TAFE, JCB, and Caterpillar.
SBI Securities Bullish Outlook and Technical Analysis
Adding significant momentum to the stock's performance, SBI Securities has initiated coverage on Pricol shares with a 'Buy' rating and an ambitious target price of ₹816 per share. This valuation represents the stock at 32x FY27E EPS of ₹25.5 (0.9x PEG) and implies an upside potential of more than 29% from its previous closing price.
The brokerage firm projects strong growth metrics for Pricol, expecting revenue, EBITDA, and PAT to grow at a CAGR of 31%, 33%, and 36% respectively over the FY25-27E period. This growth trajectory is anticipated to be driven by multiple factors including steady increase in content per vehicle, contributions from new product launches, and expansion in product offerings through strategic acquisitions.
From a technical perspective, Pricol share price has demonstrated a significant breakthrough, having broken out of a 45-week cup-and-handle pattern at ₹555. According to Anshul Jain, Head of Research at Lakshmishree Investments, the stock is now in its third consecutive week of rally, testing fresh all-time highs at ₹660.9.
Jain further elaborated that while some profit booking or sideways movement might occur as the 10-20 day EMAs catch up to price, such consolidation would be healthy for the stock's long-term prospects. Once stabilization sets in, Pricol shares appear well-positioned for a follow-through move toward ₹720, aligning with the pattern's measured target.
Impressive Historical Performance
Pricol's stock performance has been nothing short of spectacular across multiple timeframes. The shares have delivered 23% returns in one month and more than 43% gains in three months. The six-month performance shows a remarkable 50% rally, while the year-to-date performance stands at a healthy 19%.
The long-term returns have been even more impressive, with the stock delivering multibagger returns of 270% over three years and a staggering 1,122% returns in the past five years. By 10:15 AM, Pricol share price was trading 4.27% higher at ₹658.15 apiece on the BSE, maintaining strong momentum throughout the trading session.
SBI Securities expressed confidence in the company due to its presence across all leading OEMs and models, expansion of client base, high market share in instrument clusters, backward integrated manufacturing process, and diversification of product portfolio. Additional growth drivers include disc brake emerging as a new growth area, healthy new product pipeline, powertrain agnostic product portfolio, premiumisation in vehicles improving content per vehicle, and the critical nature of components supplied.
