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Polycab Conference Call Q1FY22 Highlights | Invest Yadnya

Polycab Conference Call Q1FY22 Highlights

Published on 26 July 2021 .Views 6 .Comments 0
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Financials: Polycab Stock Fundamental Analysis

  • Polycab Stock revenue was up by 93% YoY but on a QoQ basis it was down by 38%.

  • EBITDA grew by 144% YoY with 153bps improvement in margin. Cost saving initiatives were more than offset by unfavourable operating leverage and input cost volatility leading to EBITDA margin of 7.3%.

  • PBT was up by 151% YoY while PAT was down by 36% YoY on account of one off gains in the base quarter. PAT margin stood at 4.0%

  • Net Cash position at over Rs 6.7bn, as of June 2021 end, was 3.3x of same period last year

Segmental Financials: Polycab Annual Report Analysis

1. Wires and Cables: Polycab Share Analysis

  • Wires and Cables revenue doubled on YoY basis

  • In Domestic business, Cables outperformed Wires in Q1 partly on account of relatively favourable base.

  • Distribution as well as Institutional business was>2xof last year

  • While measured lockdowns with ongoing construction activities helped, sharp correction in copper prices in June temporarily impacted the trade sentiment, particularly the primary sales of retail wires

  • Exports business grew 12 % YoY. Its contribution to overall revenue improved sequentially to 6 % in Q1FY22 vs 4.5% inQ4FY21. The growth was driven by Asia, Australia, UK and Africa. Logistical challenges continued

  • Profitability was impacted by raw material inflation and adverse operating leverage

  1. Fast Moving Electrical Goods: Polycab Results

  • FMEG revenue increased by 39% YoY. The business momentum was affected by closure of retail shops across many large states.

  • Distribution expansion continued with greater thrust on digital marketing campaigns. Innovation driven product development remains a key focus area.

  • Fans grew in healthy double digits however lockdowns in April and May, which are key summer stocking periods, hurt the momentum.  Premiumization trend continued.

  •  Lights business grew with higher emphasis on augmenting portfolio across price points.

  • Switchgears saw strong growth however switches remained subdued. Solar and Conduit pipes saw healthy traction.

  • Adverse operating leverage affects profitability.

  1. Other: Polycab Stock Review

  • Other segment largely comprises of our EPC business

  • Total income at Rs 575mn grew by 19% YoY basis and decreased by 25% on a sequential basis due to the impact of pandemic.

  • Segmental EBIT was down by 6% YoY. Margin stood at 11.3%.

  • Annual sustainable operating margin in this business is expected to be in high single digit over mid to long term

Get more useful articles on various stocks with appropriate stock ratings only on Invest Yadnya. We offer numerous resources for a detailed review on Polycab status. Check out more stock articles, for a thorough Invest Yadnya review.

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