Pricol pegs exports share at 20% in 3 years as new businesses drive growth

Coimbatore-based auto parts company Pricol expects its revenue to surpass ₹2,000 crore (up from ₹1,336 crore in FY21) and exports to contribute to one-fifth of the revenue (up from 15 per cent in FY21) in 2-3 years’ time, in view of new orders and favourable growth outlook.

The company was able to win many new businesses across segments in the BS-VI platform and about 40 per cent of the revenue of FY21 was contributed by new business. With new order wins, its international business also grew 23 per cent in FY21 and the company expects the export momentum to continue.

“We are aiming at exports to be about 20 per cent of our annualised revenue in 2-3 years' time when we expect our revenue to be in the region of ₹2,000-2,100 crore,” Vikram Mohan, Managing Director of Pricol, told analysts at the Q1FY22 earnings conference call.

The company’s early preparation for the anticipated shift in instrument clusters from more of mechanical nature to software-driven driver information systems (DIS) by way of strengthening its in-house capabilities have helped it bag orders in emerging segments such as connected vehicle solutions.

The company has also bagged orders, especially for heavy-duty pumps, which are expected to add significant business and value in the coming years.

Pricol has emerged as a strong player in the area of TFT (thin film transistor), which is used to enhance quality of LCD displays, and connected vehicle solutions. It became the first company to launch connected vehicle space in a two-wheeler segment with the introduction of its solution in TVS NTorq, a premium scooter, in 2018. Post this, it has put its connected solutions in a number of vehicles. It has launched its product in electric two-wheelers too. TVS Motor’s electric scooter iQube has Pricol’s connected solution.

The company’s market share in two‐ wheeler DIS (driver information system) has increased to 52-53 per cent, from 35 per cent in the last three years, while the company’s share in commercial vehicle and off‐road vehicle segment, rose from 45‐50 per cent to 78‐80 per cent. In the passenger cars, it has moved up from near zero to about 8‐9 per cent.

Mohan pointed out that shortage of electric parts was more worrisome than Covid-19 impact. There is no sign of easing and it is affecting various stakeholders in the industry, and this will continue at least for 4-6 quarters. “We will grow at 10 per cent over industry if there is no more severe lockdowns, which may hamper production,”' he added.

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