PG Electroplast: When a multibagger meets monsoon

Subscribe to enjoy similar stories. After four years of blistering growth, PG Electroplast Ltd seems to be moving past its phase as a small-cap dream stock. Between FY21 and FY25, the company’s operating revenue jumped from ₹703 crore to nearly ₹4,870 crore—a growth of more than 62% a year.

Profit expanded even faster at over 120% compound annual growth rate (CAGR). The stock reflected this frenzy, rising almost 72 times between January 2021 and January 2025 to hit a peak of ₹1,054. That momentum has since faltered.

In under a year, the stock has fallen nearly 45% from its highs. To understand the reversal, it’s worth unpacking the business at the centre of the rally. PG Electroplast designs and manufactures room air-conditioners, washing machines, air coolers and LED TVs for major Indian and global brands.

As both an OEM and ODM, it controls everything from plastic moulding and electronics to final assembly. This backward integration helped the company capture value across the chain and fuelled investor belief that PG embodied the next phase of India’s manufacturing push. In FY25, buoyed by strong demand, the management set ambitious FY26 guidance: around 30% revenue growth and nearly 40% net profit growth.

But this optimism also reflected a heavy dependence on one category—room ACs, which accounted for close to 62% of revenue as of FY25. The summer of 2025 ended abruptly, cut short by a stronger-than-usual monsoon that arrived weeks early. For the AC industry, timing is everything.

Once the rains hit, sales collapsed. Retailers were left holding excess inventory and stopped placing new orders. As a result, the overall AC market shrank about 25% in H1FY26.