Polycab accounts for 1 in every 4 cables and wires sold in India. As of 13th January 2024, Polycab India’s market cap stood at ₹97,427 Crores.
- Over the last two years, the POLYCAB stock has nearly tripled with 184% returns.
- Polycab India has won orders worth ₹5,600 crores from BSNL, in the first week of January 2025.
- 80% of Polycab’s revenue comes from the sales of wires and cables.
Polycab’s Key Strengths and Market Leadership
About Polycab India
Polycab India is India’s leading manufacturer of wires & cables and is gunning to achieve the revenue target of ₹2,00,000 Mn for FY 2025-26. The company achieved a revenue of ₹1,80,394 Million during FY 2023-2024, at a YoY growth of 28%.
The company's business operations span across India through 23 manufacturing facilities, 15 plus offices and 25 plus warehouses. Catering to both household and industrial needs, Polycab serves industries across:
- Data Centres
- Chemicals
- Defence
- Energy
- Infrastructure
- Oil and Gas
- Telecom and more!
Close to 83% of Polycab’s revenue comes from wires and cables. Followed by this are its fast moving electrical goods(FMEG) at 8.7% and other equipment at 10.3%.
Strengths for Polycab India
1. Almost Debt-Free Company: A debt-free company typically has lower financial risk, as it doesn’t face the burden of high interest payments. This enables Polycab to allocate its resources more effectively toward growth initiatives, research, and expansion rather than servicing debt.
2. 28.1% CAGR Over the Last 5 Years: Such growth is not only a testament to the Polycab’s operational efficiencies but also reflects its growing market share in key sectors like wires, cables, and fast-moving electrical goods (FMEG).
3. Healthy Dividend Payout of 24%: This is a true testament of Polycab’s shareholder-friendly approach. Furthermore, it demonstrates that while Polycab reinvests in growth opportunities, it also rewards its shareholders for their trust and loyalty.
Weaknesses for Polycab India share
1. Trading at 11.8 times its Book Value: Polycab's stock is currently trading at 11.8 times its book value. This high price-to-book ratio could indicate overvaluation, where the stock price may not be fully supported by the company’s underlying fundamentals.
2. Decline in Promoter Holdings by 1.9%: In the most recent quarter, Polycab witnessed a 1.9% decline in promoter holdings. A reduction, though not necessarily alarming, can be perceived as a signal that insiders may be booking profits or reallocating resources.
3. Revenue dependence on Wires and Cables: Despite its diversification efforts, 80% of Polycab's revenue comes from its wires and cables segment, making the company less diversified compared to competitors. This poses a concentration risk, as any slowdown or disruption in the wires and cables market could significantly impact Polycab’s overall performance.
Financial Overview of the Polycab India Share
FY 2023-2024 has been an excellent year for Polycab India with a revenue achievement of 1,80,394 Mn. The Polycab share has seen a spike in its net profit for the last 2 quarters, jumping from ₹395.95 Crores to ₹439.81 Crores, with an average increase of 10% per quarter.
Rival Analysis: Havells, Finolex, KEI, and More
Polycab India is a category leader in the Cables-Power space. Other prominent players from the category include:
1. Havells India: Havells India Ltd. is one of the leading electrical equipment companies in India, incorporated in 1958. A household name in India, the company offers a wide range of products ranging from consumer durables, switchgear, cables & wires, home appliances and more. In the September 2024 quarter, Havell’s Mutual Funds have increased holdings from 3.8% to 3.9% and Foreign Institutions have decreased holdings from 25.3% to 24.7% .
2. KEI Industries: One of the leading manufacturers and suppliers of electrical products in India, KEI operates in various lines of business, including cables, wires, switchgear, transformers, lighting, and solar energy. Recently, mutual funds have increased holdings from 13.2% to 17.5% in Nov 2024 quarter for the company.
3. Finolex Cables: Incorporated in 1958, Finolex offers a wide range of products such as wires and cables, switches, fans and lighting products. The company reported a 10.4% increase in net sales to Rs 1,311.72 crore for September 2024.
4. Apar Industries: Apar Industries is one of the top 3 global leaders in conductors and the 4th largest global transformer oil manufacturer. As on 6th January 2025, Apar Industries share price achieved an all-time high of ₹11,168.4, reflecting an 88.4% annual return.
Megatrends and Opportunities for the electrical equipment's market
There is a strong emphasis on key sectors like energy, roads, urban development, railways and other, given India's vision of ViksitBharat 2047. As per World Bank estimates, 70% of the urban infrastructure required by 2047 is yet to be developed.
This ambitious vision will necessitate extensive electrical infrastructure and is expected to drive a substantial increase in the demand for cables and wires.
Conclusion
Polycab India has established itself as a strong player in the electricals industry, backed by its nearly debt-free status, impressive profit growth, and shareholder-friendly dividend policy. However, challenges such as high stock valuation, reduced promoter holdings, and revenue concentration in wires and cables require closer monitoring.
For investors investing in the Polycab India share or any other Indian stocks, it’s essential to take a balanced approach. As always, conducting in-depth research can help make more informed and confident investment choices.
Disclaimer
This blog is for general/educational information purposes and is no way to be considered as advice, or recommendation for investment or otherwise. Investment in securities market are subject to market risk, read all the documents carefully before investing. The securities quoted are exemplary and not to be considered as any kind of advice or recommendation. The past performance of the stocks are not necessarily indicative of future performance. INDmoney Private Limited 616, Level 6, Suncity Success Tower, Sector 65, Gurugram, 122005, SEBI Stock Broking Registration No: INZ000305337, Trading and Clearing Member of NSE (90267, M70042) and BSE, BSE StarMF (6779), SEBI Depository Participant Reg. No. IN-DP-690-2022, Depository Participant ID: CDSL 12095500.
Frequently Asked Questions about Polycab Share India
Who is the owner of Polycab India?
Polycab India Limited was founded by the Jaisinghani family in 1968. The company is now led by its Chairman and Managing Director, Inder T. Jaisinghani, who has been instrumental in expanding Polycab’s presence across India and beyond. Under his leadership, Polycab has grown into one of the largest manufacturers of wires, cables, and FMEG (Fast-Moving Electrical Goods) in India.
Is Polycab Better than Havells?
Polycab and Havells are both prominent players in the electrical goods industry, each excelling in different areas. While there is not much of a difference between the market cap and revenue for both companies, there is a stark difference between the 3 year profit growth percentage. While this number is 8% for Havells, it is a whopping 25% for Polycab. Additionally, Havells spends ₹8 per ₹100 of sales, compared to Polycab’s ₹3.
What is Polycab Famous For?
Polycab is best known for its wires and cables, which account for close to 80% of its revenue. The company also has a growing portfolio in FMEG products, such as:
- Fans
- LED lighting
- Switches
- Switchgears
- Solar products
What is the Future of Polycab Share?
Polycab India has shown consistent financial growth, driven by its strong performance in the wires and cables segment and expansion in FMEG products. With increasing government focus on infrastructure, renewable energy, and housing projects, Polycab is well-positioned to benefit from these tailwinds. However, as with any investment, market conditions, competition, and economic factors could influence its trajectory.
What is the target price for the Polycab India Share?
As of recent estimates, analysts have set short-term and long-term price targets for Polycab India shares, reflecting their growth potential. In September 2024, Mumbai-based domestic brokerage Nuvama increased wires and cables manufacturer Polycab India’s target price to Rs 8,340 from Rs 7,700, implying an upside of over 25%.
These targets can vary depending on market conditions, so investors should conduct thorough research before making decisions.
Source
Polycab India, Tijori Finance, Screen, Business Standard