Polycab India Ltd, a prominent cables and wires manufacturer, disclosed a robust financial performance in its Q3 report, with a noteworthy 15.35% surge in consolidated net profit, reaching Rs 416.51 crore compared to Rs 361.06 crore in the same quarter the previous year. This positive outcome was attributed to a substantial increase in revenue from operations, which rose by 16.83% to Rs 4,340.47 crore in Q3 of the fiscal year, up from Rs 3,715.18 crore in the corresponding period a year ago.
The surge in revenue was particularly driven by strong volume growth in the wires and cables business, as highlighted in Polycab’s earnings presentation. The company achieved a significant milestone in Q3FY24, registering its highest-ever third quarterly Profit After Tax (PAT) at Rs 416.5 crore, reflecting a 15% YoY growth, with a PAT margin of 9.6%.
Examining the financial details further, Polycab India’s total expenses for the December quarter increased by 18.08% to Rs 3,865.06 crore. Total income, including revenue from other sources, amounted to Rs 4,411.45 crore during the quarter under review, marking a substantial 17.48% increase. The revenue from the wires and cables segment exhibited a commendable rise of 16.82% to Rs 3,904.10 crore in Q3.
Conversely, revenue from the Fast-Moving Electric Goods (FMEG) segment experienced a dip of 13.4%, settling at Rs 296.17 crore. The company attributed this decline to sustained weakness in consumer demand. Meanwhile, the other segment, primarily comprising the Engineering, Procurement, and Construction (EPC) business, witnessed a significant twofold increase, reaching Rs 247.50 crore.
Amidst the positive financial performance, Polycab India faced a challenge as the Income Tax authorities conducted a search at some of its premises, plants, and residences of a few employees last month. Despite this, the company cooperated fully during the search, providing necessary details, clarifications, and documents. As of the issuance of the financial results, Polycab India had not received any written communication from the department regarding the search’s outcome. Consequently, the impact on the financial results, if any, remains uncertain.
On the market front, shares of Polycab India Ltd closed at Rs 4,431, marking a marginal 0.20% decline from the previous close. The company’s performance in the market reflects a delicate balance between positive financial indicators and external challenges.
In conclusion, Polycab India’s Q3 report underscores its resilience and capacity for growth despite sector-specific challenges. The significant uptick in net profit and revenue from operations, particularly in the wires and cables segment, demonstrates the company’s strategic positioning and adaptability. However, the potential impact of the recent Income Tax search introduces an element of uncertainty that investors and stakeholders will likely monitor closely in the coming months. Overall, Polycab India appears to be navigating a dynamic market environment, leveraging its strengths to achieve commendable financial results in the face of both opportunities and challenges.