Finolex Cables has bagged a price target upgrade from global brokerage Jefferies on delivering a strong set of numbers for the first quarter of financial year 2027, which exceeded D-street expectations.
The brokerage has raised the companny's target price to Rs 1410 from Rs 1200 previously, while maintaining a 'buy' call on the stock. It noted sturdy growth in sales and operating profits (Ebitda) in the flagship Cables & Wires (C&W) division, on the back of multiple price hikes in last 12 months.
Jefferies highlighted that the biggest turnaround in terms of operating profitability and margins was in Communication Cables division, driven by higher demand (sales volume) and better selling prices for Optical Fibre Cables (OFC).
Besides this, the brokerage underscored sustenance of operational profitability or EBIT in the Fast-Moving Electrical Goods (FMEG) or consumer appliances segment.
Going ahead, Jefferies expects benefits of backward integration to reflect in margins and profit by the third quarter of the current fiscal year. Backward integration refers to cost saving strategies which include manufacturing your own raw materials.
Finolex Cables Q1 Result
The company posted a 53% year-on-year (YoY) surge in its consolidated bottom-line to Rs 249 crore, compared with Rs 163 crore in the same quarter last year.
Revenue from operations rose 44.3% to Rs 2,013 crore, from Rs 1,396 crore a year earlier. The bigger positive was operating profit. EBITDA jumped 79% to Rs 244 crore, compared with Rs 136 crore in Q1FY26.
This pushed the EBITDA margin to 12.1% from 9.8%, an improvement of 230 basis points. Growth was not limited to one product category. The company's electrical cables segment generated Rs 1,767.45 crore, up from Rs 1,205.71 crore in the year-ago quarter. This segment also reported a result of Rs 181.97 crore, compared with Rs 117.38 crore last year.
The communication cables business delivered an even faster increase. Revenue rose to Rs 176.47 crore from Rs 108.84 crore, while segment results jumped to Rs 52.52 crore from just Rs 1.30 crore.
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