PPAP - PPAP Automotive
📢 Recent Corporate Announcements
PPAP Automotive has successfully exited its 50-50 joint venture with Tokai Kogyo, receiving ₹100 crores against an initial investment of ₹48.5 crores. The company reported Q3 FY26 revenue of ₹138.9 crores and a marginal PAT of ₹6.61 lakhs, signaling operational stabilization after previous losses. Management has issued a full-year FY26 guidance of ₹575 crores in revenue and ₹58 crores in EBITDA, excluding the extraordinary gain from the JV sale. The aftermarket segment and lithium-ion battery division are showing strong momentum, with the former growing over 30% YoY.
- Received ₹100 crores from the sale of its 50% stake in the Tokai Kogyo JV, significantly higher than the ₹48.5 crore invested capital.
- Projected FY26 revenue of ₹575 crores with an EBITDA of ₹58 crores and a PAT of ₹8 crores (excluding JV sale gains).
- Aftermarket subsidiary Elpis Automotive delivered over 30% YoY growth, driven by distribution network expansion.
- Chennai plant expansion for EPDM rubber components is on track for completion by April 2026 with a ₹30 crore capex.
- Lithium-ion battery business (Avinya) achieved record monthly sales in December, nearing an operational turnaround.
PPAP Automotive Limited has officially released the audio recording of its earnings conference call for the quarter and nine months ended December 31, 2025. The call was conducted on February 16, 2026, to discuss the company's financial performance and strategic outlook. This disclosure is made in compliance with Regulation 30 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. The recording is accessible via the company's website for all stakeholders.
- Earnings conference call for Q3 and 9M FY26 held on February 16, 2026.
- Audio recording link successfully uploaded to the company's official website.
- Compliance with SEBI (LODR) Regulations, 2015, regarding timely disclosure of investor meets.
- Investor presentation for the same period was previously submitted on February 14, 2026.
PPAP Automotive reported a flat Q3 FY26 consolidated revenue of ₹138.9 crore, while net profit plummeted to ₹0.1 crore from ₹1.6 crore YoY. A major strategic highlight is the divestment of its 50% stake in the PTI joint venture for ₹100 crore, aimed at debt reduction and funding new growth initiatives. However, management has revised its FY26 revenue guidance downwards to ₹575-600 crore from the earlier ₹600-660 crore due to deferred SOPs by OEMs. Despite the earnings drag, the company maintains a massive unexecuted order book of ₹4,103 crore.
- Divested 50% stake in PPAP Tokai India Rubber (PTI) for ₹100 crore against an investment of ₹48.5 crore.
- Revised FY26 revenue guidance down to ₹575-600 crore and EBITDA to ₹60-65 crore.
- Consolidated 9M FY26 performance resulted in a net loss of ₹2.3 crore compared to a profit of ₹4.6 crore YoY.
- Total unexecuted order book stands at a robust ₹4,103 crore as of December 31, 2025.
- Secured lifetime order wins of ₹752 crore in 9MFY26, including ₹38 crore from EV programs.
PPAP Automotive has successfully concluded the sale of its entire 50% equity stake in PPAP Tokai India Rubber Private Limited (PTI) to its joint venture partner, Tokai Kogyo Co. Ltd. The transaction was completed for a cash consideration of INR 100 crore, significantly higher than the company's aggregate investment of INR 48.5 crore. Management intends to utilize these proceeds to reduce net debt and fund strategic capital expenditure. Following this exit, PPAP plans to independently launch its own EPDM rubber sealing system business at its Chennai facility starting April 2026.
- Divested 50% stake in PTI joint venture for a total cash consideration of INR 100 crore
- Realized a substantial gain on an initial investment of INR 48.5 crore made since 2012
- Proceeds to be deployed for net debt reduction and funding planned strategic CAPEX
- Company to independently start EPDM rubber sealing operations in Chennai from April 2026
- Exit from a joint venture that the Chairman described as not having been fruitful over the years
PPAP Automotive has completed the divestment of its entire 50% stake in the joint venture PPAP Tokai India Rubber Private Limited to Tokai Kogyo for a cash consideration of ₹100 Crores. While this provides a significant liquidity boost, the company's standalone Q3 FY26 financial performance was weak, with net profit falling 76% YoY to ₹0.79 Crore. Revenue also saw a decline to ₹128.65 Crores from ₹135.34 Crores in the previous year's quarter. The divestment proceeds will significantly impact the balance sheet, as the JV previously accounted for 12.49% of the company's net worth.
- Divested 50% stake in JV PPAP Tokai India Rubber for a cash consideration of ₹100 Crores
- Standalone Q3 FY26 Net Profit plummeted 76.2% YoY to ₹0.79 Crore from ₹3.33 Crores
- Standalone Revenue for the quarter ended December 2025 declined 4.9% YoY to ₹128.65 Crores
- The divested JV unit contributed ₹35.96 Crores (12.49%) to the company's net worth in the last financial year
- 9M FY26 Standalone Net Profit stands at ₹2.36 Crores compared to ₹10.31 Crores in 9M FY25
PPAP Automotive has completed the divestment of its 50% stake in the PPAP Tokai India Rubber (PTI) joint venture for a cash consideration of ₹100 Crores. This transaction provides a significant liquidity boost, as the stake's net worth contribution was approximately ₹35.96 Crores. However, the company's standalone operational performance for Q3 FY26 was weak, with net profit falling sharply to ₹0.79 Crores from ₹3.33 Crores YoY. Revenue also saw a decline to ₹128.65 Crores, reflecting current headwinds in the automotive component segment.
- Divested 50% stake in PTI Joint Venture to Tokai Kogyo for ₹100 Crores cash.
- Standalone Q3 FY26 Net Profit plunged 76.2% YoY to ₹79.13 lakhs.
- Revenue from operations decreased to ₹128.65 Crores from ₹135.34 Crores in the same quarter last year.
- The divested JV unit accounted for 12.49% of the company's total net worth.
- Finance costs rose to ₹4.10 Crores in Q3 FY26 from ₹3.68 Crores in Q3 FY25.
PPAP Automotive Limited has scheduled its earnings conference call for Monday, February 16, 2026, at 1:00 PM IST. The company's top management, including MD & CEO Abhishek Jain and CFO Sachin Jain, will discuss the financial and operational performance for the quarter and nine months ended December 31, 2025. This routine interaction provides a platform for analysts and investors to gain insights into the company's recent performance and future outlook. Access details for domestic and international participants have been provided in the regulatory filing.
- Earnings conference call scheduled for February 16, 2026, at 1:00 PM IST.
- Discussion will cover financial results for Q3 FY26 and the nine-month period ended December 31, 2025.
- Top management, including the MD & CEO and CFO, will be present for the briefing.
- Primary dial-in numbers for the call are +91 22 6280 1309 and +91 22 7115 8210.
- International toll-free numbers are available for USA, UK, Singapore, and Hong Kong participants.
PPAP Automotive Limited has filed its compliance certificate under Regulation 74(5) of SEBI (Depositories and Participants) Regulations for the quarter ended December 31, 2025. The company's Registrar, MUFG Intime India Pvt. Ltd, confirmed that all securities received for dematerialization were processed and listed on the stock exchanges. Furthermore, physical certificates were mutilated and cancelled as per regulatory requirements. This filing is a standard procedural requirement and indicates no material change in the company's operations or financial status.
- Quarterly compliance certificate submitted for the period ending December 31, 2025.
- Confirmation of dematerialization processing within prescribed SEBI timelines.
- Physical share certificates were mutilated and cancelled after due verification.
- Registrar MUFG Intime India confirmed the substitution of depository names in the register of members.
PPAP Automotive Limited has entered into a settlement agreement to divest its entire 50% stake in its joint venture, PPAP Tokai India Rubber Private Limited (PTI), to Tokai Kogyo Co. Ltd. The transaction is valued at Rs 100 crore, which is a significant premium over the unit's net worth contribution of Rs 35.96 crore (12.49% of PPAP's total net worth). Interestingly, the JV unit contributed zero turnover to PPAP in the last financial year, making this a strategic exit from a non-revenue generating asset. The deal is expected to be completed by February 28, 2026.
- Divestment of entire 50% stake in PTI joint venture for a cash consideration of Rs 100 crore
- Sale price is approximately 2.8 times the unit's net worth contribution of Rs 35.96 crore
- The JV unit had nil turnover contribution to PPAP's consolidated revenue in the last financial year
- Expected completion of the transaction is set for February 28, 2026
- PTI will cease to be a joint venture company of PPAP following the execution of the agreement
PPAP Automotive Limited has notified the exchanges that its trading window will be closed starting January 1, 2026. This action is in compliance with SEBI (Prohibition of Insider Trading) Regulations, 2015, ahead of the company's financial results for the quarter ending December 31, 2025. The window will remain closed for all designated persons and their immediate relatives. It is scheduled to reopen 48 hours after the financial results are officially declared to the public.
- Trading window closure begins on Thursday, January 1, 2026.
- Closure is related to the upcoming financial results for the quarter ended December 31, 2025.
- The restriction applies to all designated persons and their immediate relatives.
- Trading window will reopen 48 hours after the declaration of the quarterly financial results.
Financial Performance
Revenue Growth by Segment
Consolidated revenue grew 5.97% to INR 552.06 Cr in FY25 from INR 520.94 Cr in FY24. However, H1 FY26 revenue declined 5.2% YoY to INR 253.6 Cr due to subdued offtake from automotive OEMs. The standalone revenue for FY25 was INR 537.64 Cr, showing the core business remains the primary driver.
Geographic Revenue Split
Not disclosed in available documents, though the company operates primarily in India with a focus on scaling exports to diversify its revenue base.
Profitability Margins
Operating margins recovered to 10.4% in FY25 from 7.6% in FY24. Standalone PAT for FY25 was INR 14.09 Cr compared to a loss of INR 4.67 Cr in FY24. The recovery is driven by better price pass-through to customers and improved standalone performance.
EBITDA Margin
Consolidated EBITDA for H1 FY26 was INR 22 Cr, a 21.9% YoY decline from H1 FY25. This drop was caused by lower asset utilization (65% in parts business) leading to under-absorption of fixed costs.
Capital Expenditure
The company is undertaking initiatives in EV batteries and aftermarket products. While specific total capex is not totaled, credit ratings warn that debt-funded capex leading to gearing above 1.0x would trigger a downgrade.
Credit Rating & Borrowing
CRISIL maintains a 'Stable' outlook as of mid-2025. Interest coverage ratio moderated to 2.8-2.9x in FY24 from 3.7x in FY23. Bank limit utilization averaged 62.4% for the 12 months ended June 2025.
Operational Drivers
Raw Materials
Polyvinyl Chloride (PVC) and Thermo Plastic Olefins (TPO) are the primary raw materials, which are highly sensitive to global crude oil prices and forex fluctuations.
Import Sources
A significant portion of raw materials is imported, exposing the company to international price volatility and currency risks.
Capacity Expansion
Current capacity utilization for the parts business is 65% and 85% for the tool business. The lithium-ion battery pack facility is severely underutilized at only 5% capacity as of H1 FY26.
Raw Material Costs
Raw material price increases previously compressed margins from 15-20% historically to 7.6% in FY24. The company is targeting a material yield efficiency of 88-90% to mitigate these costs.
Manufacturing Efficiency
The company delivered over 120 moulds worth INR 25 Cr with 80% capacity utilization in the tooling division. Manpower productivity is a key focus for margin expansion.
Strategic Growth
Expected Growth Rate
5-7%
Growth Strategy
Growth will be driven by a healthy order book of INR 3,439 Cr providing multi-year visibility. The strategy involves scaling the EV battery business (PPAP Technology Ltd), expanding into industrial products, and increasing aftermarket sales. Management targets FY26 revenue of INR 600–660 Cr.
Products & Services
Auto sealing systems, interior and exterior injection moulded products, lithium-ion battery packs for electric vehicles, and high-precision plastic injection toolings.
Brand Portfolio
PPAP, Avinya Batteries (acquired subsidiary).
New Products/Services
Lithium-ion batteries for EVs and industrial products. The company is also expanding its 'aftermarket' segment to diversify away from direct OEM sales.
Market Expansion
Focusing on the EV segment through PPAP Technology Limited and expanding the customer base to include white goods and appliance sectors.
Market Share & Ranking
PPAP is one of the largest players in the PVC/TPO-based profiles segment for the Indian automotive industry.
Strategic Alliances
PPAP Tokai India Rubber Pvt. Ltd. (Joint Venture) and subsidiaries like PPAP Technology Limited and ELPIS Automotives Private Limited.
External Factors
Industry Trends
The industry is shifting toward Electric Vehicles (EVs). PPAP is positioning itself by manufacturing lithium-ion battery packs, although this segment currently faces low demand and high losses.
Competitive Landscape
Competes with other auto-component manufacturers, but maintains a leadership position in specialized sealing systems.
Competitive Moat
Moat is built on long-standing relationships with marquee OEMs and leadership in the niche PVC/TPO profile segment. Sustainability depends on successfully diversifying into EV components.
Macro Economic Sensitivity
Highly sensitive to the Indian automotive industry's growth. A 5.2% revenue decline in H1 FY26 was directly attributed to a 'muted backdrop' in the auto sector.
Consumer Behavior
Shift toward EVs is the primary consumer trend affecting long-term demand for traditional engine-related components vs. new battery-related products.
Geopolitical Risks
Geopolitical developments affecting crude oil prices directly impact the cost of PVC and TPO resins.
Regulatory & Governance
Industry Regulations
Operations must comply with automotive safety and manufacturing standards. The company maintains internal financial controls as per Section 143(3)(i) of the Companies Act, 2013.
Taxation Policy Impact
The effective tax rate is approximately 25%, with FY25 standalone tax at INR 4.68 Cr on PBT of INR 18.78 Cr.
Legal Contingencies
Management performs annual impairment testing on investments in subsidiaries. No specific high-value pending court cases were detailed in the provided reports.
Risk Analysis
Key Uncertainties
The primary uncertainty is the turnaround of the EV battery subsidiary, which is currently operating at only 5% capacity and dragging down group profitability.
Geographic Concentration Risk
Manufacturing facilities are concentrated in India (Noida, New Delhi), making it dependent on the domestic auto hub's performance.
Third Party Dependencies
High dependency on a few large OEMs for the majority of revenue (70%+).
Technology Obsolescence Risk
Risk of traditional plastic components being replaced or redesigned in newer EV models, necessitating the current pivot to battery technology.
Credit & Counterparty Risk
Trade receivables stood at INR 72.40 Cr as of September 2025. Provision for bad and doubtful debts was INR 14.04 lakhs for H1 FY26, suggesting generally stable receivable quality.