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

Polycab India shares saw a significant uptick as international brokerage firm Jefferies reiterated its "Buy" rating and raised the target price to Rs 10,920. Despite a 30% rally in the stock during 2026, analysts remain bullish, forecasting a 14% upside from current market levels driven by structural growth and market leadership.

Dominating the Organized Cables & Wires Market

One of the primary reasons for the optimistic outlook is Polycab’s aggressive expansion in the organised sector. The company has successfully captured significant market share, rising from approximately 18% in FY20 to an estimated 30-31% in FY26. This dominance is reflected in the Cables & Wires (C&W) segment, which accounted for nearly 87% of FY26 revenue. This segment delivered a robust 33% year-on-year growth, fueled by 18% volume growth and 16% price-led growth. Additionally, the launch of the 'Etira' brand has allowed Polycab to penetrate tier 2-5 markets, effectively siphoning business from unorganised players.

Tapping into the Data Centre Boom

The digital infrastructure surge presents a massive tailwind for Polycab. Data centres require high cable intensity, with cables accounting for an estimated 8-10% of total data centre capital expenditure (capex). Jefferies highlighted Polycab's existing presence in this niche, noting its involvement in data centre projects for Vodafone Idea through Vertiv. This positioning allows the company to capitalize on the massive capital inflows directed toward India's digital landscape.

A Robust and Diversified Order Pipeline

Polycab maintains a healthy order book, standing at Rs 11,300 crore as of March 2026. A significant portion of this is driven by government-led initiatives such as RDSS and BharatNet. The BharatNet project alone offers an estimated revenue potential of approximately Rs 8,000 crore (excluding GST). Furthermore, the company is looking toward long-term expansion with a new extra-high voltage (EHV) cable plant, which is expected to be commissioned by the end of CY26 and contribute to revenue starting in FY28.

Strategiczna dywersyfikacja przychodów

Odporność firmy opiera się na dobrze rozłożonej strukturze przychodów, co zmniejsza zależność od jakiegokolwiek pojedynczego sektora. Podział obejmuje:

Warto zauważyć, że koncentracja klientów pozostaje niska – 10 największych klientów odpowiada za zaledwie 21% całkowitej sprzedaży, co łagodzi ryzyko związane z ewentualnym pogorszeniem sytuacji u konkretnego klienta.

Silna dynamika zysków

Jefferies podniosło docelowy mnożnik wyceny do 41x zysku, co stanowi 10-procentową premię w stosunku do pięcioletniej średniej historycznej wynoszącej 37x. Odzwierciedla to zaufanie do zdolności Polycab do osiągnięcia skumulowanego rocznego tempa wzrostu (CAGR) zysku na akcję (EPS) na poziomie 22% w latach fiskalnych FY26–FY29. Oczekuje się, że wzrost ten będzie napędzany przez zwiększenie wolumenu w kluczowym segmencie C&W oraz poprawę marż w segmencie FMEG (Fast Moving Electrical Goods).

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