Shares of Polycab India experienced a 3.5% decline in early trading on July 17, 2026, falling to Rs 8,888 from their previous close of Rs 9,216.10. This dip occurred despite the company reporting robust financial results for the first quarter of fiscal year 2027.
Strong Q1 Performance Despite Market Reaction
Polycab India announced a significant 39% year-on-year increase in revenue, reaching Rs 8,209 crore for Q1 FY27, up from Rs 5,906 crore in the same quarter last year. Earnings Before Interest, Tax, Depreciation, and Amortisation (EBITDA) also saw a healthy rise of 32.5% to Rs 1,136 crore. However, the EBITDA margin slightly narrowed by 70 basis points year-on-year, settling at 13.8%.
The company's wires and cables segment was a key growth driver, with revenue climbing 38% year-on-year to Rs 7,202 crore. The Fast Moving Electrical Goods (FMEG) division demonstrated even stronger performance, with sales surging 71% year-on-year, contributing significantly to the overall results.
Brokerages Reaffirm 'Buy' Ratings, Raise Targets
Despite the profit booking, several leading brokerages maintained a positive outlook on Polycab India's stock, reiterating their 'Buy' recommendations and revising price targets upwards.
- Nuvama highlighted Polycab's decent Q1 FY27 performance, with revenue, EBITDA, and PAT growth exceeding their estimates. The brokerage marginally increased its FY27–28E EPS by 4% each, setting a new target price of Rs 10,510, up from Rs 9,740 previously.
- Jefferies also issued a 'Buy' call, assigning a target price of Rs 11,100. The global brokerage noted the impressive sales growth in both cables and wires (39% YoY) and FMEG (71% YoY), even amidst geopolitical tensions in the Middle East during June 2026.
- HSBC maintained its 'Buy' rating with a target price of Rs 10,160. The brokerage attributed the strong Q1 earnings beat to realisation-led growth in wires and cables and robust FMEG performance. HSBC projects a 21% EPS CAGR for Polycab over FY26-29E, driven by strong demand, geographic expansion, and FMEG scaling.
Market Valuation and Risks
Following a 21% rally in the preceding month, Polycab India's stock is currently trading at 42x/35x FY27/28E earnings, compared to its five-year historical average of 37x. The company's market capitalization slipped to Rs 1.35 lakh crore during the day's trading.
Key downside risks identified by brokerages include significant volatility in commodity prices, particularly for copper and aluminum, which could impact the company's input costs and margins.