Polycab India Q1 Results Review - Domestic Demand Remains Resilient: Dolat Capital

Dolat Capital Report

Polycab India Ltd.’s Q1 FY25 revenue was ahead of estimates, while Ebitda and profit after tax were in-line. Cables and wires segment posted 12% revenue growth led by 10% volume growth in domestic business. Fast moving electrical goods grew 23% led by robust demand in fans and engineering, procurement and construction business surged 240%, driven by strong execution of RDSS order book.

Ebitda margins contracted 170 bps YoY to 12.4% due to adverse revenue mix. However, margins were within management guidance of 11-13%.

Polycab’s growth prospects remain promising given strong demand in C&W led by public and private capex and uptick in real estate. We lower our FY25E earnings per share estimates by 2% to factor in unfavorable mix and muted IB segment; we retain FY26E EPS estimate Maintain ‘Accumulate’ rating with target price of Rs 6,815 (40 times FY26E EPS).

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