Polycab India Q4FY23 PAT up 35.8% yoy at Rs425 crore on margin boost from wires and cables vertical

Polycab India reported 8.9% growth in total revenues for the March 2023 quarter on consolidated basis at Rs4,324cr. On a sequential basis, the revenues were up 16.4%. The wires and cables business of Polycab saw yoy growth in revenues of 15.2% at Rs4,078 crore while the FMEG (fast moving electrical goods) business saw revenues drop by -20% at Rs305 crore amidst weak sentiments in the consumer market.

In terms of operating profit performance, the FMEG business actually dipped from an operating profit into an operating loss. The growth in operating profits was primarily driven by the wires and cables business which saw the operating profits grow by 44% yoy at Rs590 crore. The operating margins have gone up sharply by 270 bps to 13.66% in the March 2023 quarter, even as net margins are up 171 bps at 9.82%.

Financial highlights for Mar-23 compared yoy and sequentially

The company has declared a final dividend of Rs20 per share. Operating profit growth has been sustained at higher levels through better cost management and ensuring lower funds locked up in inventories; what is referred to as inventory efficiency gains.