Pricol Ltd board approves demerger of Driver Information and Connected Vehicle Solutions Business

Pricol Limited {BSE: 540293 & NSE: PRICOLLTD}, one of India's leading automotive technology and precision engineering products and solutions company, announced today that its Board of Directors has approved a scheme of arrangement to demerge its Driver Information & Connected Vehicle Solutions ('DICVS') business undertaking into Pricol Autotech Limited. Post the demerger, Pricol Limited will continue to focus on its Actuation, Control & Fluid Management Systems ('ACFMS') and Precision Products ('P3L') businesses.

The proposed restructuring will create two focused business platforms - an automotive technology entity and an automotive & industrial precision engineering entity - simplifying the group's corporate structure while enabling each business to sharpen its strategic focus, accelerate innovation, and respond more effectively to evolving customer requirements, dynamic market realities and fast-changing technology trends through dedicated management teams and independent capital allocation frameworks.

The proposed Scheme is expected to enhance operational and financial efficiency by reducing complexity, enabling faster decision-making, while allowing each entity to align its processes, systems, and governance frameworks. The demerger is also expected to improve visibility of each business' value proposition and growth prospects, strengthen strategic and financial flexibility for each entity to pursue investment decisions aligned with their respective business portfolios and support the effective execution of its long-term strategic objectives, besides unlocking shareholder value.

Over the years, the DICVS business, which focuses on smart mobility and integrated electronic solutions, offering products such as Driver Information Systems (including connected, electronic, mechanical and electro-mechanical instrument clusters), integrated infotainment systems, advanced e-cockpit solutions, connectivity solutions such as telematics, battery management systems, and a few sensors, has evolved into a differentiated platform with distinct customer needs, competitive landscapes, technology priorities and growth opportunities. The proposed demerger recognises this evolution and enables the business to pursue independent long-term strategies, strengthen technology capabilities, partnerships for integrated solution offerings and respond more effectively to changing industry dynamics.

The ACFMS and P3L businesses will continue to remain part of Pricol Limited, with the ACFMS business being supported by growing domestic and export footprints and opportunities in fluid management and control solutions, and the P3L business being strategically positioned to capitalise on the expanding opportunity in precision components. Together, these businesses continue to strengthen Pricol's focused strategy, enhance growth visibility and contribute meaningfully to long-term value creation.

Shareholders of Pricol Limited will receive one fully paid-up equity share of Pricol Autotech Limited for every one fully paid-up equity share held in Pricol Limited (1:1 share entitlement ratio), resulting in the shareholding of Pricol Autotech Limited mirroring the shareholding of Pricol Limited, subject to the Scheme becoming effective. The resulting company is proposed to be listed on the National Stock Exchange of India Ltd and the BSE Limited. The proposed scheme remains subject to the receipt of the requisite statutory, regulatory and shareholder approvals for the Scheme.

Commenting on the development, Mr. Vikram Mohan, Chairman & Managing Director, Pricol Limited, said: "The proposed demerger marks an important milestone in Pricol's growth journey. Over the years, our businesses have evolved into strong and differentiated platforms with distinct customer needs, technology priorities, capital requirements and growth opportunities. We believe this is the right time for each business to operate independently with dedicated leadership, sharper strategic focus and greater operational agility. This new structure will enable both companies to pursue focused growth strategies, accelerate innovation and respond more effectively to evolving market opportunities. We are confident that the proposed demerger will strengthen our competitive position and create sustainable long-term value for all our stakeholders."

Shares of Pricol Limited was last trading in BSE at Rs. 586.75 as compared to the previous close of Rs. 589.65. The total number of shares traded during the day was 38149 in over 1015 trades.

The stock hit an intraday high of Rs. 599.85 and intraday low of 579.60. The net turnover during the day was Rs. 22520340.00.

Source : Equity Bulls

Keywords

Pricol INE726V01018 Demerger DriverInformationandConnectedVehicleSolutions PricoAutotech