Its revenue from operations rose 30.4% to Rs 5,498 crore, beating analysts’ estimate of Rs 4,956 crore. However, the increase in total expenses outpaced revenue growth, jumping 35% to Rs 4,984 crore.
Inder T. Jaisinghani, Chairman and MD of Polycab India, said, “We expect the demand momentum to continue, supported by increased government spending, continued investment by private players and robust real estate offtake. With a strong focus on operational excellence, we stand well positioned to capitalise on the emerging opportunities and drive steady growth.”
The fast-moving electrical goods (FMEG) segment registered a growth of 18% YoY, fueled by initiatives such as channel expansion, product architecture improvements, and robust execution of the influencer management program, the company said.
Should you buy, sell, or hold Polycab’s stock? Here’s what analysts say:
Motilal Oswal
Polycab’s 2Q earnings were largely in line with our estimates, as higher losses in FMEG business and lower C&W margin offset the higher-than-estimated revenue growth. The company is experiencing strong demand in the C&W segment both in domestic and international markets. However, increased competitive intensity and a lower share of distribution business in overall domestic revenue adversely impacted margin. We are structurally positive on Polycab due to its leadership position in the C&W segment and strong growth trajectory.
Motilal Oswal has a ‘Buy’ rating on the stocks. However, it will review its estimates after the concall.
Nuvama
Consolidated revenues grew by 30% YoY to Rs 5,450 crore, 10% above our and consensus estimates by 10%. C&W revenues grew by 24% YoY driven by favourable movement in commodity prices and continued strong demand environment. Given average copper/aluminium prices were higher 12-13% YoY, we estimate mid teen to high-teens volumes growth for Polycab. In comparison, KEI and Havells have indicated 11-12%/15% volume growth for 2QFY25.
Nuvama has a ‘Buy’ rating on the stock, basis 48x Dec-26 EPS, yielding a target price of Rs 8,340. However, the brokerage firm will revisit its estimates and target price post the earnings conference call, scheduled on Friday 18th Oct.
(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of The Economic Times)