POLYCAB Q2 FY26 earnings call.
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Revenue
₹6,477 Cr
verified against source
Revenue YoY
21%
reported change
EBITDA
₹1,830 Cr
latest reported figure
Source
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record provenance
Actual signal trajectory
Where this quarter sits.
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What the record says.
Polycab India delivered an exceptional Q2 FY26 with record performance across all key metrics. Consolidated revenue grew 18% YoY to Q2 with H1 crossing the Rs 12,000 crore milestone. EBITDA surged 62% YoY in Q2 with margin expanding 430bps to 15.8%, while PAT hit a Q2 record of Rs 700 crore reflecting 56% growth. The wires and cables segment led with 21% revenue growth driven by high-teens volume expansion and market share gains, with EBIT margins at 15.1% supported by operating leverage and favorable mix (premium wires up). International business contributed 6.5% of revenue growing 25% YoY. FMEG achieved its third consecutive profitable quarter with solar being the standout performer. EPC declined 19% YoY but margins at 18.1% included a one-time gain; ex-one-time, margins were 10%. Management flagged US tariff uncertainty as a risk to the ~20% US export contribution and expects working capital to normalize from 33 days to 50-55 days over coming quarters. Capex for H1 stood at Rs 750 crore on track for annual guidance of Rs 1,200-1,600 crore. EHV plant remains on track for end-2026 commissioning with benefits expected from FY28.
Colored figures show movement against the previous available record.
Guidance to track
- The segment has grown ahead of Project Spring guidance in the first two quarters since launch, with margins above the guided range. Management remains on track toward longer-term objectives.
- Three levers identified: (1) scaling up the Fans category to improve operating leverage, (2) gross margin expansion through premiumization across switches/switchgears, and (3) increasing share of higher-margin product categories. Third consecutive profitable quarter achieved.
- H1 capex of Rs 750 crore is in line with guidance. Spends span normal HV/MV/LV cables, EHV greenfield capacity, and brownfield expansions. Expected asset turn of 4-5x with 1.5-2 year lag generating incremental revenue.
- FY25 dividend payout raised to 26.3% from 25.5%, in line with the stated goal of crossing 30% payout ratio by FY30.
Risks flagged
- ~20% of international revenue comes from the US. Management described the situation as 'a developing scenario' and cannot provide visibility, pending trade negotiations expected to resolve by end-November 2025. Any material tariff escalation could impact the 6.5% export contribution target.
- Adani Group and Vedanta Group have announced entry into the wires segment. Management acknowledged one player has given specific commissioning timelines (~1.5 years) focusing largely on wires. Polycab has historically competed effectively against organized and unorganized players and gained market share, but increased competitive intensity could emerge over the medium term.
- An analyst asked about potential BEE star rating revisions for fans that could pressure volumes and margins in Q3. Management stated no price cuts seen as of date and that industry took price hikes in the previous quarter, but acknowledged uncertainty until Q3 actuals play out. Fans remains a drag on FMEG margins due to lower utilization rates.
- Working capital cycle temporarily reduced to 33 days from the steady-state range of 50-55 days due to inventory build-up for anticipated Q3 demand and increased LC-based raw material procurement. Management expects normalization over coming quarters, which could temporarily impact cash generation.
Key quotes
- We are not facing any particular increase in competitive intensity and that is perhaps visible in the gross margin that we are delivering. Our pricing premium compared to the other players in the industry continues to be as is as it is and we don't expect there to be any material change in the near to mid-term to that.
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