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Indian Express
6 days ago
- Business
- Indian Express
8x stock surge, record Q1 FY26 revenue: Can Polycab sustain the momentum?
In the stock market, some stories unfold quietly before they turn spectacular. Polycab is one of them. Five years ago, the well-run cables and wires company was trading in the sub-Rs800 range. It was steady, predictable, and hardly the sort of stock that was a part of conversations. Today, that same company trades close to Rs 7,000. That is an eight-fold return for anyone who stayed the course. And it has not been a straight line climb. There were pauses, pullbacks, and even a sharp fall in late 2024. Yet, the stock's swift recovery in 2025 says a lot about the conviction investors have built in its story. Polycab has earned its re-rating the hard way by cementing its leadership in wires and cables, pushing aggressively into fast-moving electrical goods, and expanding margins without losing sight of operational discipline. It has kept its balance sheet strong, sitting on over Rs 3,100 crore of net cash, and it continues to invest heavily in growth under its multi-year Project Spring plan. In Q1 FY26, Polycab delivered the highest-ever first-quarter revenue and profit in its history, showing strength across segments and geographies. For investors, the question now is whether the next phase can match or even exceed the voltage of its past run. Polycab runs two main businesses: the wires & cables segment, which is the engine room of the company, and the Fast Moving Electrical Goods (FMEG) segment, which is its growth frontier. There is also a smaller Engineering, Procurement & Construction (EPC) arm that helps it deliver turnkey electrification projects. In Q1 FY26, the company reported Rs 5,906 crore in revenue, up 26% year-on-year. The wires & cables division alone brought in around Rs 5,130 crore or about 87% of total sales, growing a strong 31% YoY. This is where Polycab's dominance shows. It sells everything from the copper wiring inside homes to the heavy-duty cables used in power plants, railways, and telecom projects. The domestic cables business grew faster than the market, hinting at market share gains. Exports are still a small slice of the business at 5.2% of revenue, but they grew 24% year-on-year in the latest quarter. Management sees the US as a significant long-term opportunity because Indian cables currently benefit from lower import duties there than Chinese cables (about 10% versus 55%). However, the domestic duty environment has become less predictable, with recent hikes making exports from India more cost-sensitive. This uncertainty means that while the US tariff gap is a strategic tailwind, sustaining export momentum will require close attention to shifting trade policies. For the FMEG business, premium products are leading the way. For instance, premium fans now contribute 25% of fan sales, premium lights make up over 35% of lighting sales, and new modular switches already account for 20% of switch sales. Even solar inverters have emerged as the single largest category in the FMEG portfolio this quarter, driven by the state-level rooftop solar push. Also, one of the big pluses is that the margins have been expanding across the board. Consolidated Earnings Before Interest, Taxes, Depreciation and Amortisation (EBITDA) margin rose to 14.5%, up from 12.4% a year ago. The wires & cables segment delivered a 14.7% EBIT margin, and FMEG's profitability has started to take shape. A big help has been a better sales mix (more high-margin products) and operating leverage from higher volumes. One of Polycab's underrated strengths is its distribution muscle. It works with over 4,300 authorised dealers and reaches 2 lakh+ retail outlets across India. This network not only moves products efficiently but also allows Polycab to launch and scale new categories faster than many rivals. The same trucks that drop electrical cables to a distributor can also deliver fans, switches, and solar inverters, creating cost efficiencies and increasing shelf space presence. The company has also kept its working capital cycle lean. In Q1, it was just 43 days, helped by efficient collections and inventory management. Sitting on Rs 3,100+ crore of net cash, Polycab can fund expansion from internal resources without taking on heavy debt, a big advantage when scaling both manufacturing and distribution. Polycab's stock has climbed nearly 8x in five years, and at the current price of around Rs 7,000, the company commands a market capitalisation of over Rs 1 lakh crore. On a trailing basis, the stock trades at roughly 45 times earnings, which is a premium to many industrial peers but in line with high-quality consumer electrical names. The market is pricing in sustained double-digit revenue growth and margin stability. The optimism is perhaps not without basis. The domestic wires and cables market is expected to grow at a mid-teens CAGR over the next five years, powered by infrastructure spending, housing demand, and the shift to premium, branded products. On top of that, Polycab's export push has a structural advantage due to favourable US tariffs, while its FMEG business offers a consumer-brand rerating opportunity if it continues to expand margins and scale. Management is also guiding for steady capex under Project Spring, targeting both capacity expansion and deeper penetration in Tier-2 and Tier-3 cities. With over Rs 3,100 crore of net cash and a lean balance sheet, this growth can be funded internally without putting pressure on returns. Still, investors should be aware of the risks. A slowdown in infrastructure or real estate activity could hit cable demand. Raw material price swings, especially in copper and aluminium, can squeeze margins if not passed on quickly. Competition in FMEG is fierce, with established consumer brands fighting for the same shelf space. And on the export side, tariff advantages are policy-driven and could change with trade negotiations. That said, Polycab's track record of execution, market share gains, and balance sheet strength put it in a position to navigate these challenges better than most. If the company can maintain high-teens revenue growth and keep margins in the 13-15% range, the stock's premium multiple may hold. For long-term investors, Polycab remains an interesting mix of a steady infrastructure play with a consumer brand growth kicker. The next few years will show whether this current keeps flowing at the same intensity. Note: This article relies on data from annual and industry reports. We have used our assumptions for forecasting. Parth Parikh has over a decade of experience in finance and research and currently heads the growth and content vertical at Finsire. He holds an FRM Charter and an MBA in Finance from Narsee Monjee Institute of Management Studies. Disclosure: The writer and his dependents do not hold the stocks discussed in this article. The website managers, its employee(s), and contributors/writers/authors of articles have or may have an outstanding buy or sell position or holding in the securities, options on securities or other related investments of issuers and/or companies discussed therein. The content of the articles and the interpretation of data are solely the personal views of the contributors/ writers/authors. Investors must make their own investment decisions based on their specific objectives, resources and only after consulting such independent advisors as may be necessary.
Reuters
05-08-2025
- Business
- Reuters
Dialysis firm FMC's earnings miss market view, hit by severe flu season in US
Aug 5 (Reuters) - Dialysis specialist Fresenius Medical Care ( opens new tab missed analysts' earnings forecasts on Tuesday, after a severe flu season in the U.S. led to higher mortality among patients and a greater number of missed treatments in the first months of 2025. FMC, which makes the bulk of its sales in the U.S. and employs most of its staff there, however was "encouraged by the strong and accelerating momentum in patient referrals" that had continued in the second quarter, CEO Helen Giza said in a statement. But the positive development in patient inflow was offset by a higher than expected outflow due to higher mortality rates in the U.S. following the severe flu season, she added. That has impacted treatment numbers for the second quarter and for the remainder of the year, FMC said. The world's largest dialysis provider said its adjusted operating income grew 9% to 476 million euros ($550.2 million) in the second quarter, but missed analysts' average estimate of 492 million euros in a company-provided consensus. Its shares were down around 3% in early Frankfurt trade. U.S. same market treatment growth was flat year-on-year, as a rise in newly started treatments partially offset patient outflow. FMC has guided for same market treatment growth of more than 0.5% in the U.S. in 2025. Quarterly revenue grew 5% in constant currency terms to 4.79 billion euros, slightly above analysts' expectations, helped by savings of 58 million euros attributable to the group's FME25 transformation program. The German group confirmed its full-year guidance, as it expects "to realize further significant operational and financial improvements" in the second half of the year, Giza said. It also said it would initiate the first tranche of its 1 billion euro share buyback programme in August. ($1 = 0.8651 euros)
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Business Standard
18-07-2025
- Business
- Business Standard
Polycab Q1 profit grows 50%, but high valuation factors in strong prospects
Polycab's Q1 FY26 revenue and profit grew 26% and 50% YoY, driven by strong performance in its C&W and FMEG segments. However, the stock's rich valuation factors in its near-term prospects premium Devangshu Datta Mumbai Listen to This Article For the April-June quarter (Q1) of FY26, Polycab's revenue beat consensus, growing 26 per cent year-on-year (YoY) to Rs 5,910 crore. The Cable & Wire (C&W) segment grew 31 per cent, and the Fast Moving Electrical Goods (FMEG) segment grew 18 per cent YoY. The EBITDA rose 47 per cent YoY to Rs 860 crore, and the margin was up 210 bps YoY to 14.5 per cent. The PAT grew 50 per cent YoY to Rs 590 crore. Overall gross margin stood at 26.9 per cent, compared to 24.6 per cent in the year-ago quarter. In C&W, the domestic business
Business Standard
18-07-2025
- Business
- Business Standard
Polycab India stock gains 2% post Q1 results: Here's what brokerages say
Polycab India share price today: Shares of cables and wires manufacturer Polycab India touched an intra-day high of ₹7,046, gaining 2.3 per cent on the NSE on Friday after the company reported a strong set of earnings for the quarter ended June 2025 (Q1FY26). At 10:25 AM, Polycab India was trading 2 per cent higher at ₹7,024 on the NSE. In comparison, the NSE Nifty50 index was down 0.57 per cent at 24,964.35 levels. The company's total market capitalisation stood at ₹1.05 trillion. Polycab India Q1FY26 result update The company's revenue from operations for the June 2025 quarter came in at ₹5,906 crore, up 26 per cent year-on-year (Y-o-Y) from ₹4,698 crore in the year-ago period. Its earnings before interest, tax, depreciation and amortisation (Ebitda) stood at ₹857.6 crore, up 47 per cent Y-o-Y. Polycab India reported a 49 per cent Y-o-Y increase in profit after tax (PAT) to ₹599.7 crore against ₹401.6 crore in the June 2024 quarter. The company wires & cables (W&C) business witnessed a 31 per cent Y-o-Y growth for the quarter on the back of sustained demand across sectors, along with higher government expenditure, better project execution and rising commodity prices. The domestic business grew by 32 per cent Y-o-Y. Polycab India's Ebitda margins improved 210 bps Y-o-Y to 14.5 per cent, supported by strategic pricing revisions, improved operational efficiency, and a favourable business mix. Brokerage views of Polycab India: Nuvama Institutional Equities Polycab India's consolidated revenues grew by 26 per cent Y-o-Y (6-year CAGR 20 per cent), beating consensus estimates by 2 per cent/5 per cent, respectively. Growth was on the back of robust performance in W&C business, supported by healthy growth momentum in FMEG, Nuvama said in a note. The brokerage has maintained a 'Buy' rating on the stock with a target price (TP) of ₹7,950. It expected other cable and wire companies to post strong earnings for Q1, partially aided by a low base. JM Financial According to analysts, Polycab India's Q1 performance was a beat on all fronts. While 33 per cent Y-o-Y growth in the C&W business was a key highlight, the FMEG portfolio also reported steady growth and improved profitability. The C&W business benefited from increased government expenditure and rising commodity prices, while the FMEG business maintained its growth momentum owing to demand from real estate, the brokerage said in a note. Another key highlight was the ramp-up in the high-margin export business, which grew 24 per cent YoY. "While Q1 was a very strong quarter for Polycab, we await more clarity on the sustainability of this performance and the way forward," it added. JM Financial has maintained a 'Buy' with a target price of ₹7,900 set at 42x June 27E EPS. About Polycab India Polycab India is India's largest manufacturer of wires and cables, with a consolidated turnover of more than ₹224 billion in the fiscal year 2024-25. It has a distribution network of over 4,300 authorised dealers and 200,000 retail outlets. The company operates 27 manufacturing facilities, 15 offices and 34 warehouses across India. It serves customers in more than 84 countries globally.
Business Standard
17-07-2025
- Business
- Business Standard
Polycab India Q1 PAT jumps 49% YoY to Rs 600 cr
Polycab India's consolidated net profit spiked 49.32% to Rs 599.70 crore on a 25.71% rise in revenue from operations to Rs 5,906 crore in Q1 FY26 over Q1 FY25. The strong revenue growth was driven by robust performance in the wires and cables (W&C) segment, supported by sustained growth momentum in the fast-moving electrical goods (FMEG) business. Profit before tax was at Rs 800.59 crore in Q1 FY26, reflecting a growth of 50.10% from Rs 533.37 crore reported in Q1 FY25. EBITDA jumped 47% YoY to Rs 857.60 crore in the quarter ended 30 June 2025. EBITDA margin improved to 14.5% in Q1 FY26 as against 12.4% in Q1 FY25, supported by strategic pricing revisions, improved operational efficiency, and a favourable business mix. On the segmental front, wires & cables business revenue grew by 30.85% YoY to Rs 5,228.6 crore in Q1 FY26, supported by sustained demand across core sectors. Key growth drivers included higher government expenditure, better project execution and rising commodity prices. The domestic business grew by 32% YoY, with cables growth once again outpacing wires. Both channel and institutional business showed healthy traction. The international business grew 24% YoY albeit on a low base and accounted for 5.2% of the Companys topline. EBIT margins for the quarter expanded by 190 bps YoY to 14.7%, aided by strategic price adjustments and operating leverage. The FMEG business continued its healthy growth trajectory to register an 18% YoY growth to Rs 454.23 crore in Q1 FY26. The fans segment witnessed a muted performance, impacted by a shorter summer season. However, categories like lights, switchgears, switches, and conduit pipes & fittings, delivered healthy growth, supported by steady demand from the real estate sector. Solar products sustained their robust growth trajectory, clocking more than 2x YoY growth and emerging as the largest category within the FMEG portfolio. Notably, the business continued its upward margin trend, achieving a second consecutive profitable quarter. Margin improvement was supported by portfolio-wide gross margin expansion, driven by a shift toward premium products, and better operating leverage from scaling efficiencies. The EPC business registered a de-growth of 19% YoY during the quarter to Rs 347.40 crore, with EBIT margins at 7.7%. As of 30 June 2025, net cash position stood at Rs 3,100 crore, against Rs 1,640 Bn in the same quarter previous year. Commenting on the performance, Inder T. Jaisinghani, chairman and managing director, Polycab India, said: We have started FY 2026 on a strong footing, delivering our highest-ever first-quarter revenue and profitability. Our Wires and Cables business continued to perform well, driven by sustained domestic demand, while our international business also delivered healthy year-on-year growth. The FMEG segment maintained its positive trajectory, marking its second consecutive profitable quarter, supported by a sharper focus on premium offerings and improved operating leverage. With continued momentum in government spending and improving project execution on the ground, we are confident in our ability to capitalise on the opportunities that lie ahead. As we progress on our five-year roadmap under Project Spring, we remain sharply focused on the strategic pillars that will drive the next phase of Polycabs growth and transformation. Polycab India is the largest manufacturer of wires and cables in India and a fast-growing player in the Fast Moving Electrical Goods (FMEG) space. The Group is also in the business of engineering, procurement, and construction (EPC) projects. Shares of Polycab India shed 0.98% to settle at Rs 6,877 on the BSE.
