PG Electroplast Ltd. (PGEL), a leading player in Electronic Manufacturing Services (EMS) and Plastic Molding, has unveiled its ambitious growth plans for the fiscal year 2026, despite facing headwinds in its Room Air Conditioner (RAC) business during the second quarter of FY2026.

Financial Performance

For Q2 FY2026, PGEL reported:

• Revenue of ₹655.37 crores, down 2.4% year-over-year (YoY)
• EBITDA of ₹44.68 crores, a 26.2% decrease YoY
• Net profit of ₹2.38 crores, compared to ₹19.47 crores in Q2 FY2025

The half-year ended September 30, 2025, showed mixed results:

• Net sales increased by 8.4% YoY to ₹2,159.22 crores
• EBITDA declined to ₹184.10 crores from ₹195.08 crores in H1 FY2025
• Net profits decreased to ₹69.09 crores from ₹104.40 crores in the previous year

Growth Strategy and Outlook

Despite the challenges, PGEL has set targets for FY2026:

• Consolidated revenues projected at ₹5,700–5,800 crores, implying 17% to 19% growth over FY25
• Net profit guidance of ₹300–310 crores, representing a 3%–7% increase from FY25
• Product business (Washing Machines, Room ACs, Coolers) expected to grow 17%–21%, reaching ₹4,140–4,280 crores

The company plans capital expenditure of ₹700–750 crores in FY26 for new projects, including:

• A refrigerator campus in South India
• A washing machine facility in Greater Noida
• Expanded AC capacity in Supa, West India
• A new facility for plastic components and coolers in Rajasthan

Operational Highlights

• PG Technoplast, a 100% subsidiary, reported revenue of ₹296 crores, impacted by soft RAC business
• The order book remains healthy across all products
• Operating margins softened QoQ and YoY due to negative operating leverage in the RAC business and increased supply costs
• Cash and equivalents stood at ₹630 crores at the end of Q2 FY26

Management Commentary

Vishal Gupta, Managing Director - Finance, stated, "Sales performance in the first half of FY26 was impacted by subdued demand in the Room AC segment, resulting in moderated growth. However, underlying demand indicators remain healthy, and the recent reduction in GST rates is expected to enhance product affordability and accelerate category penetration over the medium term."

He added, "Capital efficiency continues to be a key operating principle, with all capital allocation decisions guided by sustainable profitability and value-accretive metrics. While near-term growth momentum may moderate, the medium to long-term outlook remains positive."

Future Focus

PG Electroplast remains committed to:

• Controlling expenses and enhancing capital efficiency
• Investing in R&D, new product development, and backward integration
• Strengthening product offerings across AC and washing machine segments
• Maintaining strong engagement with existing and new clients

The company acknowledges near-term headwinds but expresses confidence in the long-term growth trajectory of the business, supported by India's structurally low penetration of Room ACs and the potential for sustained growth in the consumer durables sector.

As PG Electroplast navigates through these challenging market conditions, its strategic investments and focus on operational efficiency position it to capitalize on the anticipated growth in India's consumer electronics and appliances market.

PG Electroplast , a leading player in India's Electronic Manufacturing Services (EMS) sector, has taken a significant step to strengthen its employee engagement and retention strategy. The company announced the allotment of 6,13,000 equity shares under its Employee Stock Options Scheme-2020, demonstrating its commitment to aligning employee interests with corporate growth.

Key Details of the Allotment

• Number of Shares: 6,13,000 equity shares
• Face Value: Rs. 1/- each
• Allotted to: PG Electroplast Limited Employees Welfare Trust
• Scheme: Employee Stock Options Scheme-2020

Impact on Share Capital

The allotment has resulted in a notable increase in the company's paid-up equity share capital:

This move represents a marginal but meaningful increase of approximately 0.22% in the company's total outstanding shares.

Strategic Implications

The decision to allot these shares under the Employee Stock Options Scheme reflects PG Electroplast's strategic focus on:

1. Employee Retention: By offering equity ownership, the company aims to retain key talent in a competitive industry landscape.
2. Long-term Alignment: This scheme aligns employee interests with the company's long-term performance and shareholder value creation.
3. Motivation and Productivity: Equity ownership can serve as a powerful motivator, potentially boosting employee productivity and commitment.

Company Background

PG Electroplast is recognized as a pioneer in the Electronic Manufacturing Services industry in India. The company specializes in plastic molding and offers a wide range of services including Original Design Manufacturing (ODM) and Original Equipment Manufacturing (OEM). With a diverse product portfolio spanning LED TVs, air conditioners, washing machines, and other consumer electronics, PG Electroplast has established itself as a key player in the sector.

Market Perspective

While the immediate financial impact of this allotment may be minimal, it sends a positive signal to the market about the company's focus on human capital and long-term growth strategies. Investors and analysts often view such employee stock option programs favorably, as they indicate a company's commitment to retaining talent and aligning management interests with shareholder value.

As PG Electroplast continues to navigate the dynamic electronics manufacturing landscape, this move underscores its proactive approach to human resource management and corporate governance.

The company's stock performance and future financial results will be closely watched to gauge the effectiveness of this strategy in driving growth and shareholder returns.