Jefferies Raises Polycab Target Price to Rs 10,920: 5 Key Growth Drivers

Polycab India shares surged up to 4% following a bullish update from international brokerage Jefferies, which raised its target price to Rs 10,920. Despite a significant 30% rally in the stock during 2026, Jefferies has reiterated a 'Buy' rating, forecasting a further 14% upside driven by massive infrastructure shifts and market share dominance.

Dominating the Organised Cables & Wires Market

A primary driver behind the bullish outlook is Polycab’s aggressive expansion in the Cables & Wires (C&W) segment. The company has successfully captured significant market share from unorganised players, with its organised market share rising to 30-31% in FY26, up from just 18% in FY20.

The C&W segment remains the company's powerhouse, accounting for nearly 87% of FY26 revenue and delivering 33% year-on-year growth. This growth was fueled by an 18% increase in volume and 16% price-led growth. Notably, the launch of the 'Etira' brand has been instrumental in penetrating tier 2 to tier 5 markets.

Tapping into the Data Centre and Digital Boom

Jefferies identified data centres as a high-margin emerging growth engine. Data centres require significantly higher cable intensity compared to traditional industrial projects; cables account for an estimated 8-10% of total data centre capex, whereas they represent only about 3% in general industrial projects. Polycab is already leveraging this trend, participating in data centre projects for Vodafone Idea through Vertiv, positioning itself at the heart of India's digital infrastructure expansion.

A Massive Order Pipeline and Infrastructure Projects

The company maintains a robust operational cushion with an open order book valued at Rs 11,300 crore as of March 2026. A significant portion of this is linked to government-led initiatives such as BharatNet and RDSS.

The BharatNet project alone offers an estimated revenue potential of approximately Rs 8,000 crore (excluding GST). Furthermore, Polycab is scaling its manufacturing capabilities with a new extra-high voltage (EHV) cable plant, which is expected to be commissioned by the end of CY26, contributing to revenue from FY28 onwards.

다각화된 수익원 및 낮은 집중 리스크

Polycab의 비즈니스 모델은 다각화를 통한 회복 탄력성을 바탕으로 구축되었습니다. 수익 구조는 여러 부문에 걸쳐 잘 분산되어 있습니다:

결정적으로, 이 회사는 낮은 고객 집중 리스크를 안고 있습니다. 상위 10개 고객사가 전체 매출에서 차지하는 비중이 21%에 불과하여, 특정 고객 한 곳이 수익을 불안정하게 만들 수 없도록 보장합니다.

재무 전망 및 밸류에이션

지난 15분기 동안 EBIT 마진을 12-15% 범위로 유지한 것을 포함하여, 일관된 실적을 반영하여 Jefferies는 Polycab의 목표 밸류에이션 배수를 수익의 41배로 상향 조정했습니다. 이 증권사는 FMEG(Fast Moving Electrical Goods) 부문의 지속적인 물량 성장과 마진 개선에 힘입어, FY26에서 FY29 사이의 주당순이익(EPS) 연평균 성장률(CAGR)이 22%에 달할 것으로 예상합니다.

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