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Shares of Pricol Ltd surged 5.9% in early Tuesday trading on the BSE, hitting an intraday high of ₹524.3. The spike followed the company’s announcement to acquire Sundaram Auto Components Ltd’s (SACL) injection moulding business through its wholly-owned subsidiary, Pricol Precision Products. This move positions Pricol to strengthen its capabilities in the automotive components industry and create a new growth vertical.

Market performance and acquisition details

At around 10:08 AM, Pricol’s stock was trading 1.7% higher at ₹503.25, while the BSE Sensex rose by 0.28% to 80,473.57. The company’s market capitalisation stood at ₹6,133.69 crore. Pricol’s 52-week high is ₹542.05, with a 52-week low of ₹329.1.

The acquisition, valued at ₹215.3 crore, is being executed as a debt-free, all-cash deal. It is expected to add approximately ₹730 crore to Pricol’s consolidated topline. SACL’s established financial parameters and operational strengths are anticipated to bring significant value to Pricol, bolstering its injection moulding operations into an independent business vertical.

SACL’s legacy and synergies with Pricol

Established in 1992 and part of the TVS Motor Company, SACL is a respected player in the automotive components sector. Known for innovative polymer solutions and advanced injection moulding, the firm operates six cutting-edge manufacturing facilities across India. Its robust customer base and talent pool complement Pricol’s existing expertise in automotive technology and precision-engineered solutions.

By integrating SACL’s strengths with its own, Pricol aims to expand its footprint and enhance offerings in the injection moulding space. This strategic acquisition aligns with Pricol’s vision to diversify and grow in high-potential sectors, presenting a compelling opportunity for those looking to invest in stocks tied to the automotive industry.

Pricol’s growth trajectory

Headquartered in Coimbatore, India, Pricol has been a trusted partner for leading automotive Original Equipment Manufacturers (OEMs) worldwide since its inception in 1975. The company operates through two key verticals: Driver Information and Connected Vehicle Solutions (DICVS) and Actuation, Control, and Fluid Management Systems (ACFMS).

Pricol’s stock has delivered impressive returns, gaining 45.2% over the past year compared to the Sensex’s rise of 16.5%. The SACL acquisition is expected to further enhance Pricol’s appeal in the share market investment space by adding value through operational synergies and revenue growth potential.

Investors will be keenly observing Pricol’s execution strategy and how the acquisition strengthens its market position.