PG Electroplast shares jump 11% on strong Q3 results; PAT zooms 109% YoY, stock has jumped 300% in 12 months; check key details

PG Electroplast Shares Surge 11% on Strong Q3 Results; PAT Soars 109% YoY

PG Electroplast Ltd (PGEL), a key player in the consumer durables and electronic manufacturing services (EMS) sector, witnessed a sharp rally of 10.8%, with its share price climbing to ₹930.95 apiece on the BSE on Friday, February 7. This surge followed the company’s announcement of robust financial results for Q3 FY25, reflecting strong growth across business segments and a promising future outlook.

PG Electroplast’s consistent performance over the past year has made it one of the top performers in the BSE SmallCap universe, with the stock delivering an impressive 307% return over the last 12 months.

PG Electroplast Q3 FY25 Financial Highlights

For the December quarter (Q3 FY25), PG Electroplast posted a stellar performance, driven by strong demand in its OEM (Original Equipment Manufacturing) and ODM (Original Design Manufacturing) segments.

• Operating Revenue: ₹967.69 crore, up 81.9% YoY
• EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortisation): ₹92.37 crore, up 96.5% YoY
• Net Profit (PAT): ₹40.14 crore, up 108.7% YoY

The company attributed this growth to robust sales across its product businesses, particularly in air conditioners, washing machines, air coolers, and LED TVs.

Detailed Financial Performance Breakdown

1. Revenue Growth

PG Electroplast’s consolidated revenue for Q3 FY25 stood at ₹968 crore, with significant contributions from its Product business and subsidiaries.

• Product Business Sales: ₹663 crore, contributing 68.5% of total revenues
• PG Technoplast (100% subsidiary): ₹620 crore revenue in Q3 FY25
• Electronics ex-TV Business: Contributed 7% of total revenues, growing by 15.6X YoY

2. Profitability Metrics

The company’s focus on operational efficiencies and value chain integration resulted in a substantial boost in profitability:

• EBITDA Margin: Improved significantly, reflecting better cost management and scale advantages
• Net Profit: Nearly doubled YoY, highlighting the company’s ability to translate revenue growth into bottom-line gains

3. Capital Efficiency

PG Electroplast continues to maintain strong capital efficiency, showcasing its ability to generate returns for shareholders:

• Return on Capital Employed (RoCE): 23.5% (trailing 12 months ending Dec 2024)
• Return on Equity (RoE): 11.9%
• Net Fixed Asset Turns: 5.34x, indicating efficient utilization of fixed assets

Business Segment Performance

1. Product Business

The Product business was the primary driver of growth in Q3 FY25, contributing 68.5% of total revenues. This segment grew by an impressive 140.7% YoY, with strong demand for washing machines, air conditioners, and air coolers.

2. TV Business

The TV segment, managed by Goodworth Electronics, also showed robust performance:

• Sales in 9MFY2025: ₹436.56 crore, up from ₹253.63 crore in 9MFY2024, marking a 72.1% YoY growth

3. Electronics ex-TV Business

This segment, though smaller in contribution, saw a remarkable 15.6X growth in Q3 FY25, indicating the company’s diversification efforts are yielding positive results.

Future Outlook and Guidance

PG Electroplast’s management remains optimistic about the company’s future, citing strong demand, new client acquisitions, and capacity expansion as key growth drivers.

Revenue and Profit Guidance for FY2025:

• Revised Revenue Guidance: ₹4,550 crore (up 65.7% over FY2024)
• Net Profit Guidance: ₹280 crore (up 104.5% over FY2024’s ₹137 crore)
• Group Revenue (including Goodworth Electronics): ₹5,100 crore

Product Business Growth Projections:

• Expected to grow nearly 98% to ₹3,300 crore from ₹1,668 crore in FY2024

Capital Expenditure Plans:

• Capex for FY2025: ₹370-380 crore
• New Greenfield Facilities: Two new plants in North India and further expansions in Supa facilities

Strategic Initiatives and Growth Drivers

PG Electroplast has positioned itself as a one-stop solution provider for electronic manufacturing services (EMS) and contract manufacturing for leading consumer durable and electronics brands in India.

The company boasts one of the largest plastic injection molding capacities in the country, enabling it to serve diverse sectors, including room air conditioners, washing machines, air coolers, and LED TVs.

Key growth drivers include:

1. Expansion of Manufacturing Capacities: The commissioning of new facilities will significantly boost production capacity, catering to increasing demand in both domestic and international markets.
2. Diversification of Product Portfolio: The company is diversifying into new product categories, such as electronics ex-TV, to reduce dependency on a single product line.
3. Strengthening OEM/ODM Capabilities: With enhanced design and manufacturing capabilities, PG Electroplast aims to attract more OEM and ODM partnerships with global brands.
4. Operational Efficiencies and Margin Improvement: The company expects gradual improvement in margins due to better operational efficiencies and economies of scale.

Market Performance and Share Price Trend

PG Electroplast’s stock has been a stellar performer in the BSE SmallCap universe, delivering a 307% return in the last 12 months.

• Current Share Price: ₹930.95 (as of February 7, 2025)
• 52-Week Performance: The stock has consistently outperformed broader market indices, reflecting strong investor confidence in the company’s growth trajectory.

Analyst Views and Market Sentiment

Analysts remain bullish on PG Electroplast’s prospects, citing the company’s strong financials, robust order book, and strategic expansion plans.

• Brokerage Firm Views: Several brokerage firms have upgraded their price targets for the stock, anticipating continued growth in revenues and profitability.
• Investor Sentiment: With a strong earnings track record and clear growth roadmap, PG Electroplast is attracting significant interest from both retail and institutional investors.

Conclusion

PG Electroplast’s Q3 FY25 performance underscores its strong fundamentals, operational efficiency, and strategic vision. The company’s focus on capacity expansion, diversification, and capital efficiency positions it well for sustained growth in the coming years.

With revised upward guidance for both revenue and profits, PG Electroplast is poised to remain a top contender in the consumer durables and EMS sector. The stock’s 300%+ return over the past year highlights its potential as a high-growth investment, making it a company to watch in 2025.

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