News

Published: October 23, 2023
Updated: October 23, 2023

Polycab India Grows Steadily, Eyes Early Achievement of ₹20,000 Crore Revenue Target

Polycab India's Remarkable Stock Surge

Polycab India Ltd has witnessed a phenomenal journey in the past year, with its stock price nearly doubling. This remarkable ascent is attributed to the consistent growth in the company's earnings, bolstered by increasing demand. Even more promising is Polycab's confidence in reaching its FY26 revenue target of ₹20,000 crore, and there are indications that this goal might be achieved ahead of schedule. The cable manufacturer plans to revise its revenue growth guidance in the upcoming quarters, as stated in the Q2FY24 earnings call.

Strong Q2 Performance Exceeds Expectations

The second quarter of the fiscal year was eagerly anticipated, and it did not disappoint. Polycab reported a 55% year-on-year increase in consolidated pre-tax earnings, amounting to ₹557 crore, while revenue surged by 27% to reach ₹4,218 crore. Polycab's strong market position, with a 22-24% market share in organized wires and cables (W&C), positions the company as a prime beneficiary of the government's focus on infrastructure development and the momentum in private sector capital expenditure.

Wires and Cables (W&C) Segment Dominates

During the second quarter, Polycab's Wires and Cables (W&C) segment made a significant contribution, accounting for 88% of the gross revenue. This segment experienced robust volume growth, resulting in a 29% increase in revenue to ₹3,805 crore. Government capital expenditure and strong demand in the real estate sector were identified as key growth drivers. Notably, the W&C segment also witnessed a noteworthy expansion in the Earnings Before Interest and Tax (EBIT) margin, which increased by 285 basis points, reaching 14.6%.

Polycab India's impressive performance in Q2, with substantial revenue growth and rising earnings, signifies its strong position in the market. The company's ambitious revenue target of ₹20,000 crore for FY26 appears well within reach and could potentially be achieved ahead of schedule. As Polycab continues to thrive, it remains poised to benefit from government initiatives in infrastructure development and private sector capital expenditure. The future looks promising for Polycab India as it forges ahead with its growth plans.