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Dolat Capital Report
Polycab India Ltd.'s Q4 FY23 revenue was inline while Ebitda and profit after tax beat our estimates. Cables and wires segment revenue increased 15.2% in Q4 led by high single digit volume growth, outperforming Havells India Ltd. cables and wires (+5.4%) and KEI Industries Ltd. (+9%).
Cables and wires segment delivered 290 basis points Ebitda margin expansion to 14.5% in Q4, was a positive surprise, driven by strong momentum in international business (+125% YoY) and higher margin orders in the cable business.
Polycab India's management has reiterated its target of Rs 200 billion top-line by FY26E and annual margin guidance of 11-13% in cables and wires segment going ahead (13.1% in FY23).
Judicious price increases, favorable product mix and improvement in fast moving electrical goods profitability FY24E onwards should boost overall margin performance.
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