Polycab is the largest manufacturer of wire & cable in India. The company also entered the fast moving electrical goods (FMEG) space in 2014 and has recorded strong segment revenue CAGR of 32% in the last five years.
Polycab is the market leader in the wire & cable business with organised market share of 22-24%. In the FMEG segment, it is growing through new product launches and dealer addition across India. The company has ~4600 dealers, serving ~2 lakh retail outlets
Robust b/s with RoE, RoCE of 18%, 22%, respectively, (three-year average)
Q3FY23 Results
Cables & Wires segment drives Q3FY23 performance
Revenues were up ~10% YoY to ~₹ 3715 crore led by ~13% growth in the wires & cable segment. FMEG segment revenue remained flat on a YoY basis at ₹ 342 crore due to subdued demand conditions
Gross margin increased ~309 bps YoY supported by better product mix, judicial price revisions and lower RM costs. As a result, EBITDA margin increased by 284 bps YoY to 13.6%
PAT grew by ~14% YoY to ~₹ 361 crore YoY (up 33.4% QoQ) tracking strong topline growth and EBITDA margin expansion
Electrical Equipment/Products company Polycab India announced Q3FY24 & 9MFY24 results:
Financial Performance
- Total revenue for 9MFY24 reached Rs 1,24,475 million, marking a significant 27% growth compared to the same period last year.
- EBITDA for 9MFY24 rose to Rs 17,303 million, reflecting a noteworthy increase of 40% YoY.
- Profit After Tax (PAT) went up by 46% to Rs 12,494 million in the 9MFY24.
- Q3FY24 revenue stood at Rs 43,405 million, up by 17% YoY.
- Q3 EBITDA and PAT saw increments of 13% and 15%, respectively, with PAT amounting to Rs 4,165 million.
Business Segments
- Wires & Cables business observed an 18% YoY revenue growth in Q3 and 29% over 9MFY24, facilitated by strong volume growth.
- The FMEG sector experienced a decline of 15% in revenue during Q3 due to weaker consumer demand, with a slight 2% de-growth over 9 months.
Operational Highlights
- A unified Business Unit Head has been appointed to oversee the merger of the FMEG and Power businesses.
- International business contributed to 6.2% of the consolidated revenue for the quarter, with expectations of robust performance in the subsequent quarters.
Profitability and Cash Position
- Q3FY24 reported PAT margin of 9.6%.
- Net cash position saw improvement, reaching Rs 18.4 billion on December 31, 2023, from Rs 15.3 billion in the previous quarter.
- In 9MFY24, there was an improvement in margins by approximately 120 bps to 13.9%, and PAT margins enhanced by about 130 bps to 10%.
Commenting on the performance, Inder T. Jaisinghani, Chairman and Managing Director, Polycab India, said: "Our robust business momentum continued in the third quarter, leading to highest-ever quarterly revenues in the history of the Company. Nine-monthly revenues and profitability too created newer highs. This outstanding success is a testament to our resilient business model, characterized by robust operational efficiency, a diverse and innovative product portfolio, and the robustness of our extensive distribution network that effectively caters to diverse market segments. With a keen eye on emerging trends, Polycab aims to continue its upward trajectory, creating long-term value for our stakeholders."
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