Polycab India Limited — Q3 FY26 earnings call

Call held 16 Jan 2026

Management summary

Polycab India Limited delivered robust Q3 FY26 results with consolidated revenues growing 46% YoY and PAT reaching a record ₹6.3 billion. Strong performance in Wires and Cables, coupled with healthy growth in FMEG, drove the top-line. While EBITDA margins were temporarily impacted by a strategic staggered pass-through of commodity inflation, the company maintained a strong balance sheet and is on track with its long-term capex plans, confident in sustained demand and market share gains.

Highlights

  • Consolidated revenues grew 46% YoY, driven by strong execution in W&C and healthy FMEG growth.

  • PAT reached a highest-ever Q3 of ₹6.3 billion, reflecting 36% YoY growth and 8.3% PAT margins.

  • Domestic W&C business posted an exceptional 59% YoY growth in revenue and nearly 40% volume growth, indicating strong market share gains.

  • FMEG segment grew 17% YoY and remained profitable for the fourth consecutive quarter, with solar business growing over 2x YoY.

  • Maintained a strong balance sheet with a net cash position of ₹30.3 billion and continued strategic capex as per Project Spring guidance.

Concerns

  • EBITDA margins were impacted to 12.7% (vs. ~13% ex-one-off) due to a strategic decision to stagger the pass-through of sharp commodity price inflation (copper +22% sequentially).

  • Working capital cycle increased to 27 days due to inventory build-up in anticipation of Q4 demand, though expected to normalize.

  • International business growth was softer at 5% YoY and its contribution to consolidated revenues declined to 6%, partly due to tariff-related issues in the U.S.

Key financials

  1. Consolidated Revenue Growth 46%
  2. EBITDA Growth 34%
  3. EBITDA Margin 12.7%
  4. PAT ₹630 Cr +36%YoY
  5. PAT Margin 8.3%
  6. Working Capital Cycle 27 days

What they filed

Q1 FY27: revenue up 39.0%, net profit up 32.8% against the same quarter last year.

₹ Cr · quarterly
Line itemQ2 FY25Q3 FY25Q4 FY25Q1 FY26Q2 FY26Q3 FY26Q4 FY26Q1 FY27
Revenue5,498 5,226 6,986 5,906 6,477 +18%7,636 +46%8,864 +27%8,210 +39%
EBITDA632 720 1,025 858 1,021 +62%966 +34%1,161 +13%1,136 +32%
Net profit445 464 734 600 693 +56%630 +36%786 +7%797 +33%
How to read this

₹ crore, as filed. The percentage beside a figure is the change against the same quarter a year earlier — never the quarter before, which would make every seasonal business look like it collapses and booms each year.

Segment breakdown

  • Wires & Cables (W&C)
    53% Revenue Growth59% Domestic W&C Revenue Growth40% Domestic W&C Volume Growth70% Wires Revenue Growth50% Cables Revenue Growth
  • Fast Moving Electrical Goods (FMEG)
    17% Revenue Growth200% Solar Business Growth
  • EPC
    ₹406.9 Cr Revenue4% Revenue Growth6.7% Margin

Order book

medium confidence

Composition

Mix 2 projects
  • BharatNet Scheme (Project Execution) ₹450 Cr 56.3%
  • BharatNet Scheme (Project O&M) ₹350 Cr 43.8%

Share of order book by project, derived from disclosed amounts

Management noted a healthy order book for international business and commenced execution of significant EPC orders under the BharatNet scheme.

Source: Prepared remarks

Capital allocation

high confidence
  • Capex ₹340 Cr this quarter · ₹1,200 Cr (annually through FY30) planned
    • Long-term capacity expansion and growth under Project Spring ₹1,200 Cr
    Capital expenditure for the quarter was ₹3.4 billion, taking the 9M FY26 total to ₹10.9 billion, in-line with our Project Spring guidance of investing ₹12 billion to ₹16 billion annually through FY30.
  • Liquidity Cash ₹3,030 Cr Company maintains a strong balance sheet with a net cash position.
    We continue to maintain a strong balance sheet, closing the quarter with a net cash position of ₹30.3 billion.

Guidance & targets

Working Capital

  • Working Capital Cycle Working Capital · coming quarters · High confidence 50-55 days
    We expect this to normalize to our long-term steady range of 50 to 55 days in the coming quarters.

    — Shashank Yagnick

Capex

  • Annual Capex Capex · annually through FY30 · High confidence ₹12-16 billion
    in-line with our Project Spring guidance of investing ₹12 billion to ₹16 billion annually through FY30.

    — Shashank Yagnick

FMEG

  • FMEG Industry Growth Multiplier FMEG · by FY30 · High confidence 1.5x - 2x
    remain on track to achieve our Project Spring targets of 1.5x - 2x industry growth and EBITDA margins in the range of 8% to 10% by FY30

    — Shashank Yagnick

  • FMEG EBITDA Margin FMEG · by FY30 · High confidence 8-10%

    — Shashank Yagnick

EPC

  • EPC Sustainable Operating Margin EPC · mid-to long term · Medium confidence high single digits
    the annual sustainable operating margin is expected to remain in the high single digits over mid-to long term.

    — Shashank Yagnick

A&P Spend

  • A&P Spend as % of B2C Top-line A&P Spend · every year · High confidence 3-5%
    we've given a guidance that we want to spend around 3% to 5% of B2C top-line every year on A&P.

    — Chirayu Upadhyaya

What to watch in Q4 FY26

Working Capital Cycle Normalization

coming quarters
Current 27 days
Target 50-55 days

Why it matters

Indicates improvement in operational efficiency and cash flow management.

We expect this to normalize to our long-term steady range of 50 to 55 days in the coming quarters.

Risks & concerns

  • Commodity price volatility and its impact on margins

    high

    Sharp rise in copper (+22% sequentially) and aluminum prices led to margin compression due to staggered pass-through, though management is confident in recovering margins.

    Management acknowledged

  • Higher working capital cycle due to inventory build-up

    medium

    Working capital cycle at 27 days, higher than usual, due to strategic inventory build-up for Q4 demand, but expected to normalize to 50-55 days.

    Management acknowledged

  • Softer international business growth and U.S. tariff issues

    medium

    International business grew only 5% YoY and contributed 6% to revenues, with U.S. market weakness attributed to tariff-related global overhang.

    Management acknowledged

Q&A highlights

7 direct
EBITDA margin compression despite high volume growth and price hikes Partial
The primary reason has been the sharp rise in commodity prices. From January 2025 till January 2026, the copper, in rupee terms, has risen almost 50% and aluminium almost 25%. And in this quarter itself, the 22% inflation has happened in copper price compared to previous quarter. We had taken a conscious call to pass it on in a staggered manner.

Explains the core reason for margin pressure, highlighting management's strategic trade-off to protect volumes and market share over immediate margin realization.

Asked by Sonali Salgaonkar

Quantum of price hikes implemented and remaining Direct
The total price hikes that we would have taken within this quarter will be almost 75% to 80% of whatever commodity inflation was there. The remaining will happen during this quarter.

Provides clarity on the company's pricing strategy and the expected timeline for full cost pass-through, impacting future margins.

Asked by Sonali Salgaonkar

Impact of continued commodity price inflation on demand and potential for destocking Direct
from demand perspective, we are very confident that the growth momentum will continue. We are seeing healthy traction across government and private capex as well as the real estate sector, with significant investments flowing into power utilities and infrastructure. From that perspective, we do not see demand as challenge for us.

Addresses a key investor concern regarding demand sustainability amidst rising input costs and clarifies management's confidence in underlying market strength.

Asked by Akshay Gattani

Capacity utilization and sequential margin improvement outlook for Q4 Direct
So, our capacity utilization in the quarter was in the early 80% range. Yes. I mean it should definitely get better [Q4 margins].

Offers insight into operational efficiency and provides a positive outlook for sequential margin recovery in the upcoming quarter.

Asked by Puneet Gulati

Performance of FMEG sub-segments, particularly fans and solar Direct
Solar, as was mentioned in the opening comments, had a very good quarter, another very good quarter after having 1-1.5 years of very good offtake momentum. We expect even Q4 to be very strong. You would have seen that we had actually launched a newer range of 350-kilowatt solar inverters last quarter, and that did very well for us.

Details the key drivers of FMEG profitability and growth, highlighting the strong performance and positive outlook for the solar business.

Asked by Aniruddha Joshi

Significant market share gains in W&C given domestic growth vs. industry growth Direct
Yes, so Aniruddha, that's something that I was mentioning. We need to appreciate the fact that in spite of a 300 bps decrease in our margin profile, we were able to deliver 34% profitability growth in this segment. And that is on the back of such high 59% domestic growth. There's obviously a bit of an export growth as well. I think our strategy is working very well.

Confirms the effectiveness of the company's Project Spring strategy in driving competitive gains and outperforming the market.

Asked by Aniruddha Joshi

EBITDA margin profile for exports, domestic cables, and domestic wires Direct
Exports are definitely much higher as compared to domestic margins. Historically, we've been making at least around 15% of EBITDA margins in our exports. If you look at the domestic sales for us, cables versus wires, in cables, generally, we make anywhere between 9% to 12% of EBITDA margins. Whereas in case of wires, it is between 15% to 16% EBITDA margins.

Provides granular detail on segment-wise profitability, crucial for understanding the impact of product and geographical mix shifts on overall margins.

Asked by Vidit Trivedi

Strategy and run rate for A&P (Advertising & Promotion) spend Direct
we've given a guidance that we want to spend around 3% to 5% of B2C top-line every year on A&P. Even with this increased spend of this quarter, we are hardly at around 1.5%, currently. So, every year going ahead, we can definitely see an improvement or increase in our investments towards A&P.

Clarifies the company's long-term marketing investment strategy and explains the quarterly variations in A&P spend.

Asked by Pulkit Patni

3 min read 7 chapters

Detailed narrative

Robust Revenue Growth Across Key Segments

Polycab India Limited reported a strong Q3 FY26 with consolidated revenues growing 46% year-over-year. This growth was primarily driven by the Wires and Cables (W&C) segment, which saw a 53% YoY revenue increase, with domestic W&C volumes growing by nearly 40%. The Fast Moving Electrical Goods (FMEG) business also contributed significantly, achieving 17% YoY growth, notably propelled by its solar business which grew over 2x YoY.

Profitability Impacted by Strategic Pricing Amidst Commodity Inflation

EBITDA margins for Q3 FY26 stood at 12.7%, impacted by a one-off gratuity provision of ₹219 million and a strategic decision to stagger the pass-through of sharp commodity price increases. Copper prices, for instance, rose 22% sequentially this quarter, and 35% from April to December. Management indicated that 75-80% of the commodity inflation was passed on within the quarter, with the remaining expected to be passed on in Q4 FY26, a conscious choice to protect volumes and market share.

Strong Balance Sheet and Committed Capital Expenditure

The company maintains a healthy financial position, closing the quarter with a net cash position of ₹30.3 billion. Capital expenditure for Q3 FY26 was ₹3.4 billion, bringing the 9M FY26 total to ₹10.9 billion. Polycab reiterated its Project Spring guidance, committing to invest ₹12 billion to ₹16 billion annually through FY30, signaling continued focus on long-term capacity expansion and growth initiatives.

Working Capital Cycle and Inventory Management

The working capital cycle for the quarter increased to 27 days, primarily due to a strategic build-up of inventory in anticipation of strong demand in Q4 FY26, particularly for wires. While this is higher than the long-term average, management expects the working capital cycle to normalize to its steady range of 50-55 days in the coming quarters, indicating a temporary deviation for strategic market positioning.

FMEG Segment Returns to Profitability, Solar Leads Growth

The FMEG segment achieved profitability for the fourth consecutive quarter, with its solar business emerging as a standout performer, growing over 2x YoY and becoming the largest contributor to the segment. While the fans business experienced a softer start to the quarter due to channel inventory and weather, it saw some recovery in December. Polycab aims for FMEG EBITDA margins of 8-10% by FY30, supported by strategic A&P investments.

Robust Demand Environment and Significant Market Share Gains

Management highlighted a robust demand environment, driven by sustained government and private capex, as well as a strong real estate sector. The exceptional 59% YoY growth in domestic W&C revenue, coupled with a 40% volume growth, significantly outpaced the estimated industry growth of around 20%, indicating substantial market share gains. This performance is attributed to execution excellence under Project Spring and improved channel partner relationships.

EPC Business and BharatNet Project Progress

The EPC business recorded revenues of ₹406.9 million, growing 4% YoY, with a segment margin of 6.7%. During the quarter, Polycab commenced execution of existing orders under the BharatNet scheme. This project is expected to generate ₹4.5 billion for project execution over the next three years and an additional ₹3.5 billion for project O&M over ten years, providing significant long-term revenue visibility for the EPC segment.

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