Management has answered it in recent concall.
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I have a very basic doubt when I see the Pricol costumer base it has names like TVS, Bajaj etcâŚ
but the sales of TVS below particularly Iqube,
But Pricol sales are
I mean I might be wrong because they might not have sold Driver info systems to TVS but in all the other clients that Pricol have their sales are very,
I mean does each driver info system(DIS) does not consider as one sale.
Pls help me to understand this. Thank you.
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Donât understand the question fully, will answer whatever I understood.
1.Manegement has said they have 100% supplier of DIS for TVS so based on that we can conclude DIS system installed on TVS iQube should be from Pricol.
2. Now coming to revenue comparison, EV contribute to 7-8% of sales onlyâŚin that 7-8% some contribution could be from iQube.
Management have guided their EV growth should be same as EV sector growth.
Letâs assume EV sales double then 7-8% could become 15% assuming other thing are sameâŚso even if EV sales double their revenue could only increase by 7-8%.
Hopefully solve your doubt.
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Pricol quarterly sales figures are in Rs Crores. Assuming one DIS system would be sold at Rs 500. So even if TVS sales 10,000 bikes per month, Pricol sales for the same would be just Rs. 50 LakhâŚSo for a quarter it would be just 1.5 CrâŚSo when company sales increased by 49 Cr in Q4 FY 23, only 1.5Cr would be contributed by DIS supplied to TVS IQube⌠So there is no way you can correlate IQube sales to Pricol sales directly.
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Thank you so much @Amol_Bhandare @Marathondreams
Is there any other company that involved in this type of business related to DIS in India,
Minda Corp is one of them. There could be other listed and unlisted companies
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Thank you @Marathondreams
Assuming Pricol does very well for next 7years all the EV demand and DIS export increase, margin expansion etc can the PE alone increase from what it is now like 24 PE to how much like is there another company or business I could use to estimate the future PE,
Thank you for your response.
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Minda plans fund raise of upto Rs.600 crores.
https://www.bseindia.com/xml-data/corpfiling/AttachLive/b2c4e1dd-af46-42b7-8e39-15b54c0fbe9c.pdf
It is interesting developmentâŚFew months back, when Minda acquired stake in Pricol, they mentioned that this was their financial investment and best use of their idle moneyâŚThey also said they are generating enough cash from operations to fund their own capex plansâŚand now thisâŚ
Excerpts from Minda concall held on 20 Feb 23 post Pricol stake acquisition is as below
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Irrespective, isnât it a positive sign?
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Competitor wants to buy looking at + growth prospect.
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Promoters want to increase their own stake. Added 1.3% recently.
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Promoters not willing to let go of the company and planning to battle.
What do these perspectives tell us about the business?
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Yes, All the positive things playing out from the past few days. I observed that volumes are not high even the promoters and competitor were buying and also price also not moved. Any reason for that?
Just wanted to know from market perspective
Disc: invested in tracking position.
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Hope it helps, Analysis of Pricol.
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Hi, I recently joined Valupickr and I must acknowledge contributions from fellow investors which enabled in creating this amazing platform.
Infotainment and DIS[both could be in same ECU or different one] are advancing each year and to achiver any product, it requires a cumulative collaboration of lot companies. 2W only have DIS, so most probably theyâve only one ECU.
Normal product/value chain of ECU development for PVâs:
- OEM such as Suzuki, Tata motors etc decide the timelines, platforms and features.
- Tier 1 companies such Bosch, Harman, Continental, Visteon which provide the complete solution from hardware to software.
- Chip vendors such as qualcomm, Samsung, Nvidia. this agreement is usually made by OEM with chip vendors and then they supply to Tier 1 comapnies.
- Product Software providers such as all Tier1 and software services companies such as KPIT, LTTS, TATA elxi in indian context.
- Hardware/Software platform cycle from concept to release to customers is atleast 4-5 years, so it doesnât change every year.
- This is independent on whether it is EV or ICE car.
- OEMâs just buy a readmade solution from Tier1 like plug in and plug out systems with little modifications.
Iâm not sure if product life cycle is different for 2W.
i went through the quarterly PPT, concalls and this blog and I have few questions, really appreaciate if somebody is able to answer these questions.
- Do they develop software in collabroation with âSibrosâ for all their systems?
- How does it matter if it is EV or normal 2W/PV for DIS because DIS just displays information on display. This usually comes from vehicle network when some event happened occurs somewhere else in vehicle like speed change or fule level etc. EV or not shouldnât have any bearing on DIS or infotainment systems.
- Pricol appears to provide out of the box solution to clients from hardware to software. If it is the case, pricol should have more bargaining power(OPM should have been more) and theyâre simply too powerful and indispensable to OEMâs in my opinion but I doubt thatâs the case. There are only handful of companies who can provide the complete solution and they dictate terms with OEMâs.
- In thier PPTâs theyâve mentioned they also supply to PVâs, does anybody have any info on any released car on which pricol systems are present?
- Does pricol have long term contract with chip/material suppliers?
- Are they also have any plan to foray into infotainment systems?
@Worldlywiseinvestors I would love to have your input on these points.
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They havenât mentioned it clearly, they are saying that they are offering âsolutionsâ but they are not breaking it down further. One can easily say that by looking at their margins. Even if they are, it doesnât matter much when it comes to Driver display units as you build base SW (which is hard built)/Firm ware leave a plug to the unit and a calibration file give them to the OEM and OEM flashes the API (soft built) on top it and connect it to the vehicle Newtwork. Your work is pretty much done here unless any recalls! Letâs say after a year an OEM wants to offer a different outlook to the display or add an extra attribute to the DIS for one-time fixed pay or monthly subscription Pricol doesnât get a penny.
you can confirm that from their concall
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it doesnât matter if itâs EV or not. But the trend is EVâs are getting bigger display units compared to ICE so that increases the cost and material so Pricol will be the beneficiary purely because of size of the display unit.
3.Pricol is primarily providing the assembled display unit (DIS) a hardware and base software embedded in and remember for DIS units you need less powered processor compared to Infotainment processor so get a processor from a chip seller and place it on PCB and assemble rest of all electronic junk and place a LED display unit on face of it. It doesnât have the pricing power which is completely fine all Auto Tier1âs or suppliers shall never have any pricing power over OEMâs (forget auto ancillaries, OEMâs themselves doesnât have pricing power
Only exception used to be TESLA with recent reduction in prices they also joined the line 
) (proof can be found above concall picture) usually OEM make two or three auto suppliers BID against each other to get a cheaper deal. In management words "Yes Pricol is coevolved the product. We arrive at what would be the right pricing for that product and in that what should be the value of the driver information system and what features can be offered on that. So it is coevolved as a solution with the customer. I do not think we are really building a product, but rather we are moving towards building a solution for the end customer based on market research of the OEMs and then they work closely with us .They are saying that they are offering the âsolutionsâ what sort of Dontknow 
.
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not a big deal if you just provide a display unit assembly to an OEM. Better question is are you developing the infotainment display as well? which clearly is not.
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Until now Tier1âs and Chip makers used to have good relationship and Tier1 takes the lead provide complete unit according to the OEM requirements. Now OEM are making exclusive partnership with Chipmakers and asking them to design the chip according to their requirements and pass it on to the Tier1âs for integration and packaging send it to the OEMâs. (this is true for High end systems like ADAS and AV systems) but in case of driver display units itâs mostly TIER1âs call.
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Good question, management hasnât talked about it anywhere so far.
Disclaimer : Invested and biased.
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âMinda Corp says Madras HC vacates interim injunction granted earlier w.r.t Pricol stake buy. HC vacates interim injunction w.r.t adjudication of its application by CCIâ - As reported by Moneycontrol.
Could anyone dumb this down to explain what has happened?
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Pricol (and Minda) seems like a case of unstoppable force and immovable object.
I hope immovable object, i.e. Pricol wins. Started investing but not sure who wins here hence paused new purchase.
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