Finolex Cables Q4 Results Review - Inline; Robust Industry Outlook To Drive Re-Rating: Systematix

NDTV Profit’s special research section collates quality and in-depth equity and economy research reports from across India’s top brokerages, asset managers and research agencies. These reports offer NDTV Profit’s subscribers an opportunity to expand their understanding of companies, sectors and the economy..Systematix Research Report.Finolex Cables Ltd. Q4 (revenue/Ebitda/profit after tax up 14%/11%/6% YoY) came inline with our estimates. Volume in electrical wires grew 16% YoY, driven by construction and infrastructure development activities. In FY24, volumes in wires and cables grew 15% and 26%, respectively. Finolex Cables aims to grow two times of the nominal GDP growth in the cable and wires division. Volume of optic fiber cable in Q4 saw some pick-up. However, it was down 30% YoY in FY24 due to delay in tenders from the govt as well as from private telecom players. 5G roll out is taking time but it provides strong growth opportunity for several years. After a ~Rs 2.2 billion capex in FY24, it further plans to invest Rs 3.4 billion in FY25, mainly on the E-beam facility (phase-1 under commissioning; second line to be operational by Sep-24) and the Preform facility (should be operational by Dec-24). Improving outlook of the electrical wire industry in last two-three years is benefitting Finolex Cables performance and driving its valuation re-rating. .We expect Finolex Cables’ large valuation gap with peers to narrow. We increase earnings estimates by ~5% and now expect 15%/21% CAGR in revenue/PAT over FY24-26E. While we increase our target price to Rs 1,574 (~25x FY26E price/earning for 25% return on invested capital, earlier Rs 1,341 at ~23 times), we downgrade rating to Hold after a massive ~70% rally in its scrip since 14-Mar-24. .Click on the attachment to read the full report:.EPL Q4 Results Review - Cost Rationalisation, Ramp-Up Of Brazil Business To Drive Earnings: Motilal Oswal.DISCLAIMERThis report is authored by an external party. NDTV Profit does not vouch for the accuracy of its contents nor is responsible for them in any way. The contents of this section do not constitute investment advice. For that you must always consult an expert based on your individual needs. The views expressed in the report are that of the author entity and do not represent the views of NDTV Profit..Users have no license to copy, modify, or distribute the content without permission of the Original Owner.

Finolex Cables Q4 Results Review - Inline; Robust Industry Outlook To Drive Re-Rating: Systematix

Finolex Cables aims to grow two times of the nominal GDP growth in the cable and wires division.

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