Pritika Auto

Pritika Auto Industries reported a robust Q4 and FY26, with consolidated revenue reaching INR138.46 crores (up 36.20% YoY) and INR482.95 crores (up 35.32% YoY) respectively. The company achieved its highest-ever annual production volume of 52,620 metric tons in FY26, underscoring consistent capacity ramp-up and operational improvements. This strong performance was driven by healthy demand from key OEM customers and an improved product mix focusing on high-value castings.

The company's focus on low-cost mechanization and targeted automation has enabled an annual throughput expansion of approximately 10% without significant capital outlay. Pritika Auto is increasingly shifting towards high-weight, large castings like gearboxes and transmission cases, which offer better realization and margin profiles due to less competition in this niche market. This strategic shift is a key driver for product mix improvement and profitability, with the company gaining market share by growing 34% compared to the market's 16-17%.

Pritika Auto made its first step into international markets by acquiring a 100% stake in Omnia Engineering Inc., a newly incorporated Delaware entity, for $50,000 as an initial tranche of a $100,000 plan. This move aims to establish a foothold in the US market, allowing direct engagement with US customers and exploring engineering sector opportunities. Management anticipates these operations to yield higher EBITDA margins of 18-20% compared to India's 14-15%.

Product development and qualification work for the railway segment are ongoing. While revenue from this segment is not yet material, initial contributions are expected to begin in financial year 2027. This diversification is a crucial long-term growth lever, aiming to broaden the customer base beyond traditional automotive OEMs and contribute meaningfully to revenue and bottom line within the next 2-3 years.

Q4 FY26 saw a decline in EBITDA margin to 12.02% from the 16-17% range, primarily due to a sharp increase in raw material and gas prices in March 2026. Management expects these cost pressures to be largely pass-through to customers, with margins anticipated to revert to the 15-16% range in the coming quarters. This recovery is also supported by improving capacity utilization, targeted to reach 80-85% in FY27.

For FY27, Pritika Auto plans a capex of INR25-30 crores to add 7,800 tons of Green Sand capacity, funded entirely by debt. In FY28, a larger capex of INR60-70 crores is planned to add 20,000-24,000 tons of LFC technology, which will be funded by a combination of debt and equity. The LFC technology is highlighted for its capital efficiency, requiring almost 50% less investment for the same capacity compared to conventional methods, making it a strategic choice for future expansion.

The company acknowledges the ongoing development in EV components for tractors and commercial vehicles but does not foresee any near-term structural disruption to its core business. Management notes that the electrification horizon for their served segments (tractors and CVs) is materially longer than for passenger vehicles, with no major EV platforms expected in the next 2-5 years. There is only very slight movement in EV adoption within heavy commercials and off-road equipment.