09-05-2025
Hold Polycab India, target price Rs 6,150: ICICI Securities
Polycab India's key products/revenue segments include Cables & Wires, Fast-Moving Electrical Goods (FMEG), Income from Eng. Construction Contracts, Grants, Export Incentives for the year ending 31-Mar-2024.
Financials
For the quarter ended 31-03-2025, the company has reported a Consolidated Total Income of Rs 7033.87 crore, up 33.95 % from last quarter Total Income of Rs 5251.07 crore and up 24.59% from last year same quarter Total Income of Rs 5645.73 crore. The company has reported net profit after tax of Rs 734.36 crore in latest quarter.
The company's top management includes T Jaisinghani, Sharma, Banerjee, Mr.T P Ostwal, Mr.R S Sharma, Tongia, Talati, R Jaisinghani, A Jaisinghani, Agarwal. Company has B S R & Co. LLP as its auditors. As on 31-03-2025, the company has a total of 15 crore shares outstanding.
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Investment Rationale
Polycab reported strong numbers in Q4FY25. Highlights were: (1) FMEG portfolio reported profit at EBIT level, after posting losses for past 10 quarters. Reduction in ad-spend, as % of net sales, and operating leverage led to higher EBIT margins. (2) With increase in copper prices as well as normalisation of trade inventory in wires in Q4FY25 after reduction in trade inventory in Q3FY25 led to strong growth in cables and wires segment. However, deferment of orders led to 24% revenue decline in international business. (3) The company has also gained market share of ~100bps in domestic organised cables and wiresindustry. With competitive intensity likely to inch up in cables and wires with the entry of Ultratech and Adani in FY27-28, ICICI Securities models Polycab to focus on market share gains even if there is a margin impact in the near term (DCF accretive). They trimmed FY26E earnings by 3.2% and retain HOLD with a DCF-based revised target price of Rs 6,150 (implied target P/E of 32x FY27E EPS).
Promoter/FII Holdings
Promoters held 63.04 per cent stake in the company as of 31-Mar-2025, while FIIs owned 11.11 per cent, DIIs 10.79 per cent.
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(You can now subscribe to our ETMarkets WhatsApp channel ICICI Securities has a Hold call on Polycab India with a target price of Rs 6150. The current market price of Polycab India is Rs 5905.05. Polycab India, incorporated in 1996, is a Mid Cap company with a market cap of Rs 88638.46 crore, operating in the Consumer Durables India's key products/revenue segments include Cables & Wires, Fast-Moving Electrical Goods (FMEG), Income from Eng. Construction Contracts, Grants, Export Incentives for the year ending the quarter ended 31-03-2025, the company has reported a Consolidated Total Income of Rs 7033.87 crore, up 33.95 % from last quarter Total Income of Rs 5251.07 crore and up 24.59% from last year same quarter Total Income of Rs 5645.73 crore. The company has reported net profit after tax of Rs 734.36 crore in latest company's top management includes T Jaisinghani, Sharma, Banerjee, Mr.T P Ostwal, Mr.R S Sharma, Tongia, Talati, R Jaisinghani, A Jaisinghani, Agarwal. Company has B S R & Co. LLP as its auditors. As on 31-03-2025, the company has a total of 15 crore shares reported strong numbers in Q4FY25. Highlights were: (1) FMEG portfolio reported profit at EBIT level, after posting losses for past 10 quarters. Reduction in ad-spend, as % of net sales, and operating leverage led to higher EBIT margins. (2) With increase in copper prices as well as normalisation of trade inventory in wires in Q4FY25 after reduction in trade inventory in Q3FY25 led to strong growth in cables and wires segment. However, deferment of orders led to 24% revenue decline in international business. (3) The company has also gained market share of ~100bps in domestic organised cables and wiresindustry. With competitive intensity likely to inch up in cables and wires with the entry of Ultratech and Adani in FY27-28, ICICI Securities models Polycab to focus on market share gains even if there is a margin impact in the near term (DCF accretive). They trimmed FY26E earnings by 3.2% and retain HOLD with a DCF-based revised target price of Rs 6,150 (implied target P/E of 32x FY27E EPS).Promoters held 63.04 per cent stake in the company as of 31-Mar-2025, while FIIs owned 11.11 per cent, DIIs 10.79 per cent.
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