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HomeMarket NewsPG Electroplast shares in focus after Q4 results, FY26 guidance miss
The management of PG Electroplast continues to maintain that while the near-term growth may moderate, the medium-to-long-term opportunity remains strong.
Shares of PG Electroplast Ltd. will be in focus on Friday, May 29, after the company reported its fourth quarter results on Wednesday, May 27, and missed its full-year guidance, that it had earlier warned of, due to the Iran war.
For the March quarter, PG Electroplast reported a 10% decline in its topline to ₹1,717 crore. Analysts were projecting the topline to decline by 7%. The company highlighted that the overall disruptions, including the LPG crisis and truck shortage led to a revenue loss of ₹420 crore during the quarter.
Earnings Before Interest, Tax, Depreciation and Amortisation (EBITDA) fell by 44% from last year to ₹119 crore, while margins narrowed to 6.9% from 11.1% in the year-ago quarter. Cost inflation, higher commodity prices and negative operating leverage impacted the company's margins.
Gross margins were down nearly 300 basis points to 15.7%. Weak pricing power, commodity inflation and weakness in the currency could not be fully passed on, and that impacted gross margins by 250 basis points.
FY26 Guidance Missed
For the full year, PG Electroplast reported revenue growth of 9%, which is well below the company's guidance of 17% to 19% growth, which it had been maintaining over the last few quarters.
Net profit was lower by 32% for the full year, while the company had guided for it to grow between 3% to 7%.
PG Electroplast's Cash Conversion cycle has stretched to 66 days from 50 earlier, while inventory days have increased to 82 from 56 earlier. The cash on books has also gone down to ₹389 crore from ₹979 crore earlier.
Management Commentary
According to the company, weak room AC demand and multiple supply side disruptions materially affected their operating performance for the quarter.
For the Room AC (RAC) business, January and February remained soft and the LPG crisis of March impacted RAC production. Products business contributed to 76% of the company's topline in financial year 2026, of which RAC contributes 86%.
The management also said that while the near-term growth may moderate, the medium-to-long-term opportunity remains strong.
The company's new refrigerator manufacturing plant in Sri City and the compressor manufacturing facility at Supa are both likely to commence operations by the fourth quarter of financial year 2027.
Shares of PG Electroplast had ended Wednesday's trading session with gains of 2% at ₹476. The stock has already declined 11% so far in the month of May.
