Sharekhan's research report on Polycab India
Company reported a strong revenue of Rs. 5592 crore, a growth of 29% y-o-y. It was led by volume growth of over 30% in C&W business and good performance in the EPC segment. Operating profit and PAT for the quarter was Rs. 762/546 crore and grew 25%/29% on a y-o-y basis. Robust C&W volume growth is expected to continue, given good government and private capex. EPC business is also on a strong growth trajectory. Company has increased the capex guidance to Rs 1000-1100 crore annually for the next three years.
Outlook
Strong government and private capex with a growing real estate sector augurs well for growth of the company. We expect revenue/PAT to clock a CAGR of 19%/18%, respectively from FY24-26, with a good RoCE of 31%. Hence, we maintain a Buy rating on the stock with a revised PT of Rs 7400.
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