Polycab India's September quarter performance has drawn positive views from Jefferies, Citi, and JPMorgan, with all three brokerages retaining bullish ratings after the company reported strong growth in profit and revenue. Jefferies and JPMorgan cut their target prices marginally, while Citi raised its target to Rs 11,600 from Rs 10,900, citing strong underlying demand and robust execution. Brokerages also highlighted the outlook for cables and wires, export growth, and competitive intensity as key factors to track.
Polycab India Q2 Results At A Glance
- Net profit: Rose 42.6% YoY to Rs 977 crore
- Revenue: Increased 52.8% YoY to Rs 9,899 crore from Rs 6,477 crore.
- Ebitda: Grew 39.4% YoY to Rs 1,423 crore from Rs 1,021 crore.
- Ebitda margin: Declined 1.4 percentage points YoY to 14.4%.
Jefferies On Polycab India: Buy
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- Rating and target price: Jefferies maintained its Buy rating on Polycab India but cut its target price to Rs 11,040 from Rs 11,100.
- Earnings beat: The brokerage described the September quarter as another quarter of results beating expectations.
- Cables and wires margins: Ebit margin in the cables and wires segment declined to 14.2%, reflecting a high base in the year-ago period.
- FMEG performance: The fast-moving electrical goods segment recorded a notable improvement in Ebit margin to 10%.
- Earnings growth outlook: Jefferies views Polycab as a play on power demand and capital expenditure, estimating a 22% compound annual growth rate in earnings per share between FY26-FY29.
Citi On Polycab India: Buy
- Rating and target price: Citi maintained its Buy rating and raised its target price to Rs 11,600 from Rs 10,900.
- Competitive concerns: The brokerage believes concerns over competition are overstated, with execution remaining strong.
- Demand outlook: Citi expects underlying demand to remain robust and believes the market can absorb commodity inflation.
- Top sector pick: Polycab remains Citi's top pick in the consumer durables and electricals space.
JPMorgan On Polycab India: Overweight
- Rating and target price: JPMorgan maintained its Overweight rating but reduced its target price to Rs 9,700 from Rs 10,000.
- Broad-based earnings beat: The brokerage described Polycab's quarterly performance as an all-around beat.
- Key monitorable: Recovery in cable growth, a pickup in exports, and competitive intensity remain the key factors to watch.
Also Read: Polycab India Q2 Results: Profit Rises 43% To Rs 977 Crore, Revenue Jumps 53%
Polycab India: What Investors Should Know
All three brokerages retained positive ratings on Polycab following its September quarter performance, although their target-price revisions reflect differing expectations. Citi has the highest target price at Rs 11,600, followed by Jefferies at Rs 11,040 and JPMorgan at Rs 9,700.
Strong demand, execution, and the potential benefits of power and capital expenditure spending remain supportive factors. However, investors will track the recovery in cables and wires growth, export momentum, competitive intensity, and the impact of commodity inflation on margins.
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