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Polycab India - Expect Demand Recovery In H2 FY23; Rich Valuations Limit Upside: Nirmal Bang

Polycab India - Expect Demand Recovery In H2 FY23; Rich Valuations Limit Upside: Nirmal Bang

<div class="paragraphs"><p>Cables and wires manufactured by Polycab India Ltd. (Source: Company website)</p></div>
Cables and wires manufactured by Polycab India Ltd. (Source: Company website)

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Nirmal Bang Report

We spoke to the management of Polycab India Ltd. as part of our virtual investor conference to gain insights into the current business environment, demand trends, commodity costs and supply chain headwinds, besides the company’s business outlook going ahead.

The management highlighted that demand in the second half of June 2022 was muted due to volatility in copper prices. However, it expects this trend to be transitory and expects H2 FY23 to be better compared to H1 FY23.

Despite the recent correction in copper prices, the management has maintained its Rs 200 billion topline guidance for FY26 under project Leap.

For Polycab’s fast moving electrical goods segment, the management aims to reach 12% Ebitda margin by FY26-end through higher operating leverage, new product offerings, product premiumisation and cost optimisation measures. However, the stock has rallied by 14% in the last two months and offers limited upside from current levels.

Click on the attachment to read the full report:

Nirmal Bang Polycab India - Management Meet Update -.pdf

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