PG Electroplast might apply for the IT hardware PLI, says MD

Electronics manufacturing service provider PG Electroplast is likely to explore the emerging opportunities in the local laptop manufacturing space using its capability to produce Printed Circuit Board Assemblies (PCBAs), a crucial component in the IT hardware ecosystem.

Vikas Gupta, Managing Director of Operations at PG Electroplast, who recently shared his perspective on the PLI 2.0 scheme in an interview with CNBC-TV18,  said that the company is eager to explore the laptop manufacturing opportunity presented by the scheme.

“The move that has been made by the government to ban the import of laptops and other ready-to-use IT devices,  provides a huge opportunity for the local manufacturers. We are currently evaluating this opportunity and we might be going in for applying for the PLI in the IT hardware that has been announced,” Gupta said.

In a significant move aimed at bolstering domestic manufacturing in the IT hardware sector, the Indian government introduced the PLI 2.0 scheme in May, extending its support to a diverse range of products including laptops, tablets, all-in-one PCs, servers, and ultra-small form factor devices. This strategic step comes as a follow-up to the successful implementation of the previous version of the Production-Linked Incentive (PLI) scheme, demonstrating the government's commitment to fostering self-reliance and reducing import dependency.

Under the revamped PLI scheme, the government has made considerable enhancements to its incentives, signalling its intent to accelerate the growth of the IT hardware industry. One of the key provisions of the new scheme allows applicants who participated in the earlier version to reapply, indicating the government's openness to continuous engagement and refinement of its policies.

Gupta also advocated for a more lenient approach to laptop import licensing, suggesting that the government could consider being more permissive in this aspect to further stimulate domestic manufacturing. He underscored the importance of creating an environment that encourages local production while addressing the demand for high-quality IT products.

Furthermore, Gupta provided insights into PG Electroplast's future plans, mentioning the company's projected capital expenditure (capex) of Rs 180 crore for the fiscal year 2023-24. He expressed confidence in achieving an asset turnover ranging from 4.0 to 4.5 times, indicating efficient resource utilisation and effective business strategies.

Gupta also articulated the company's growth trajectory, outlining their commitment to maintaining a robust revenue growth at a CAGR (Compound Annual Growth Rate) of 30 percent over the next three years.

“The kind of opportunity that is there in the market that we are serving, we definitely see an opportunity and we can maintain a CAGR of almost around 30 percent for the next three-four years,” he said.

This ambitious goal reflects PG Electroplast's confidence in the potential of the IT hardware sector and its alignment with the government's vision of making India a global manufacturing hub.

PG Electroplast stock has surged over 8 percent intraday on Monday, now trading near Rs 1,690, and has recorded a remarkable 7 percent gain in the last month.