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Informist, Thursday, Oct. 17, 2024

By Anjali Singh

MUMBAI – Wire and cable maker Polycab India Ltd. reported strong growth in consolidated revenue for the September quarter, as robust demand drove strong growth across all segments. However, the company missed meeting the Street's estimates on the bottom line. The company's consolidated revenue rose over 30% on year in the latest quarter to INR 54.98 billion, its fastest growth in four quarters. The top line grew 17% on a sequential basis. The revenue even beat the highest estimate of INR 52.33 billion from Elara Securities.

The company's net profit for the September quarter was INR 4.40 billion, up over 3% from INR 4.26 billion in the year-ago period. Sequentially, the bottom line grew 11%. Net profit for Apr-Sept was INR 8.36 billion, up a mere 1% from the year-ago period. The top line grew nearly 26% to INR 101.96 billion in Apr-Sept from INR 81.07 billion in the year-ago period. 

The electrical cable and consumer goods company's earnings before interest, taxes, depreciation, and amortisation was INR 6.32 billion, up 4% year-on-year. The EBITDA margin fell to 11.5% this quarter from 14.4% a year ago. The company's margin was affected by competition in the wires and cables business. The margin was also affected by the faster growth of the low-margin institutional business compared to the distribution business, increased advertisement and promotion expenses, and employee expenses in the fast-moving electronic goods segment, the company said in a press release.

SEGMENTS-WISE PERFORMANCE

The revenue of the wires and cables segment in the domestic market grew 28% on year in the September quarter, with growth in wires outpacing that of cables. The institutional business outperformed the distribution business, the company said. The segment's margin contracted 30 bps quarter-on-quarter. "We expect the demand momentum to continue, supported by increased government spendings, continued investment by private players and robust real estate offtake," Inder T. Jaisinghani, chairman and managing director of Polycab India, said. 

The fast-moving electronic goods segment expanded 18% on year in the quarter on the back of channel expansion, changes in product architecture, and influencer management programme, the company said. Among electrical equipment, fans, which had a low base last year, primarily led the growth in the segment. A rise in online sales also contributed to the fan segment.

Revenue from Polycab's other segments, which largely comprise the engineering, procurement, and construction business, grew 241% annually and 14% sequentially to INR 5.49 billion. On Thursday, shares of the company closed at INR 7,120.55 on the National Stock Exchange, down almost 1% from the previous close.  End

Edited by Ashish Shirke

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