Why Is Polycab India Outperforming Industry Benchmarks Despite High Valuations?
Polycab India has once again demonstrated its industry leadership with strong Q2FY26 earnings. According to Nuvama Institutional Equities, the company’s revenue, EBITDA, and adjusted PAT grew 18%, 62%, and 51% YoY respectively — well ahead of peers in the electricals and cable sector. The brokerage maintained its Buy rating with a target price of ₹9,070, underscoring Polycab’s structural strength in both domestic and export markets.
The results indicate sustained demand in core segments like Cables & Wires (C&W) and continued expansion in FMEG (Fast-Moving Electrical Goods), supported by favourable pricing, volume growth, and operating leverage. With the company on track for a 19–21% CAGR in revenue and profitability through FY28, the growth story remains intact.
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Q2FY26 Financial Performance Overview
Polycab’s latest quarter shows broad-based strength across business verticals. The company continues to benefit from infrastructure expansion, rising housing demand, and a steady export pipeline. Margins saw meaningful expansion on account of better realizations and product mix improvements.
Polycab India Q2FY26 Key Metrics
| Metric | Q2FY26 | YoY / Remarks |
|---|---|---|
| Revenue Growth | +18% | Strong volume & pricing momentum |
| EBITDA Growth | +62% | Driven by margin expansion |
| Adjusted PAT Growth | +51% | Operational efficiency impact |
| C&W Segment Revenue | +21% | High-teens volume growth; 280 bps margin expansion |
| C&W EBIT Margin | 15.1% | Up 280 bps YoY |
| FMEG Segment Growth | +48% | Emerging as key diversification driver |
| FMEG EBIT Margin | 0.5% | Modest but improving sequentially |
The margin uplift in the C&W segment demonstrates Polycab’s pricing power and operational discipline. The FMEG business, though still nascent, is scaling up strongly with product innovation in lighting, fans, and appliances, which should gradually enhance blended profitability.
Demand and Growth Outlook
Polycab’s management and Nuvama’s analysis both point to sustained demand momentum, backed by:
- ✅ Robust domestic infrastructure spending and electrification projects.
- ✅ Consistent export demand from Middle East, Africa, and ASEAN regions.
- ✅ Supportive commodity pricing environment aiding stable input costs.
The strong positioning of Polycab within the formalized electricals space enables it to capture incremental market share from unorganized players. Its aggressive capacity expansion and deep distribution network further reinforce growth visibility.
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Valuation and Investment View
Nuvama projects Polycab’s revenue, EBITDA, and PAT to grow at a CAGR of 19%, 21%, and 21% respectively during FY25–FY28, driven by continuous market share gains and brand strength. At 40x Dec-26E EPS, the stock commands a premium valuation — justified by superior execution, return ratios, and sectoral leadership.
Compared to peers like Havells India and Finolex Cables, Polycab maintains a healthy balance of growth and profitability. Havells trades at ~50x forward earnings, while Finolex trades around 25x, indicating Polycab’s valuation remains balanced for its growth trajectory.
With robust financial metrics, expanding product mix, and visible order pipeline, Polycab remains a long-term compounder in the Indian capital goods ecosystem.
Investor Takeaway
Indian-Share-Tips.com Nifty Expert Gulshan Khera, CFP®, who is also a SEBI Regd Investment Adviser, highlights that Polycab India’s Q2FY26 results reaffirm its consistent growth leadership. The company’s efficient cost management, product innovation, and demand tailwinds make it one of the most dependable plays in the industrial manufacturing space.
While valuations appear elevated, they are backed by strong fundamentals and multi-year growth prospects. Long-term investors can consider accumulating the stock on dips for structural gains aligned with India’s infrastructure expansion.
Discover more expert-led research and practical investment insights at Indian-Share-Tips.com, which is a SEBI Registered Advisory Services.
Related Queries on Polycab India
- What Makes Polycab India’s Q2FY26 Performance Stand Out?
- How Does Polycab’s Growth Compare to Havells and Finolex?
- Is Polycab Overvalued or a Long-Term Compounder?
SEBI Disclaimer: The information provided in this post is for informational purposes only and should not be construed as investment advice. Readers must perform their own due diligence and consult a registered investment advisor before making any investment decisions. The views expressed are general in nature and may not suit individual investment objectives or financial situations.
