EMS Stock to Buy Now for 40% Upside; Recommended by Nuvama
Cooling products are having a good run in India, and the companies that actually build them, not just the brands on the box, are getting more attention from investors. Contract manufacturers sit quietly behind the big names, making air conditioners and washing machines for others. Their sales can look great on the top line, so the real story usually sits a little lower down, in margins and cash.
PG Electroplast shares are trading at ₹499.00, up 0.54% from the previous close of ₹497. Market cap is ₹14,332 crore and the consolidated P/E is 69.36. The 52-week range is ₹436.85 to ₹644.90.
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PG Electroplast is an Indian electronics manufacturing services company, formally set up in 2003 and the flagship of the PG Group, which began in 1977. It makes products for other brands, as both an original design manufacturer (it designs and builds the product) and an original equipment manufacturer (it builds to the brand's design), plus plastic injection moulding.
Its main products are room air conditioners, washing machines and air coolers, along with LED TVs, PCB assemblies, plastic parts and tools. It serves 70+ Indian and global brands, runs 11 plants across Greater Noida, Ahmednagar, Bhiwadi and Roorkee, and employs 10,000+ people.
Sales Sprint, Profit Jogs
The company reported consolidated revenue of ₹2,034.0 crore for the June 2026 quarter, up 35.2% from ₹1,503.9 crore a year ago. It's the first time quarterly revenue has crossed ₹2,000 crore. Profit after tax rose 12.9% to ₹75.3 crore, so sales growth was over two and a half times the profit growth.
EBITDA, which is operating profit before interest, tax, depreciation and amortisation, rose 12.1% to ₹156.2 crore, but EBITDA margin slipped to 7.7% from 9.3%. Raw material cost took 85.5% of sales against 84.1% last year. The company blames high commodity prices, and says industry pricing works on a fixed rupee margin per unit, so costlier inputs push the margin percentage down even when per-unit earning stays same. It adds that the cost rise was only partly passed on to customers.
AC Is Doing The Heavy Lifting
Products, meaning ACs, washing machines and coolers, made 80.2% of revenue and grew 40.7%. AC sales rose 38.1% to ₹1,401.4 crore and washing machines jumped 67.2% to ₹210.8 crore. Coolers grew 3.4% to ₹18.9 crore. The company also says its new washing machine plant in Greater Noida has come online, and it will have capacity to make 1.8 million machines a year.
Cash Balance Has Come Down
Cash and bank balance was ₹491.3 crore at the end of June 2026, against ₹910.6 crore a year back. Receivable days, how long customers take to pay, went to 58.6 from 45.1, and inventory days climbed to 99.5 from 72.0. Return on equity, the profit earned on shareholders' money, fell to 6.7% from 13.4%. Gross debt was ₹417.4 crore, so the company is still in net cash of ₹73.9 crore.
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What Nuvama Says
Nuvama maintained a Buy rating on the stock with a target price of ₹700, which works out to be an upside potential of 40% from current levels. According to Nuvama, the company expects its AC volumes to grow around 20% in FY27, ahead of expected industry growth of about 15%.
Nuvama also says a new compressor plant with 2 million units capacity is on track to start production by December 2026. A compressor is the part that pumps refrigerant in an AC, so it's a big piece of the machine. On costs, Nuvama says the company has passed on around 75-80% of the raw material inflation to customers, and has kept its FY27 EBITDA margin guidance at 7.5-8% excluding PLI, the government's incentive scheme that pays companies for what they produce.
Bottom Line
On the company's own numbers, sales are growing fast but profit is lagging, cash is lower than a year ago and return on equity has halved. The stock trades at a consolidated P/E near 69, so a lot of good news may already be in the price. Nuvama's Buy and ₹700 target lean on its note's view of AC volumes and the compressor plant, which the company's presentation doesn't cover. Margins and cash are the two things to watch in coming quarters.