Finolex Cables Ltd. share price target

Higher Tax Provision Impacted Bottom Line; Finolex top line grew by 6.4% YoY on the back of strong performance from Electrical cables which grew by 11.6%.

Volume and Revenue Growth Across Segments: Finolex top line grew by 12.2% YoY on the back of strong performance from communication cable which grew by 16.6% and electrical cable showing a growthof 7.5%.

Finolex Cables Ltd (FCL) is India's largest manufacturer of electrical (85% of revenue) and telecommunication cables (9%). FCL has a wide distribution network with a high brand recall....

Margins maintained despite higher input cost: Finolex top line grew by 10.7% for 9MFY18 which was in line with expectations on the back of strong performance from communication cable which grew by 34.6%. However electrical cable segment has grown by 5.3% due to lower volumes on account of high GST rates which are now normalised.

Healthy Performance Amid Tepid Market : Finolex posted strong set of Q1FY18 numbers growing across all products and segments. Net sales for the quarter ended Sept 2017 were Rs. 6880 Mn as against Rs. 6142 Mn representing 12.0% YoY growth in value terms. The revenues have grown by 18.2% in H1FY18 when compared to respective period last year.

Strong Performance Amid Tepid Market:Finolex came out with strong set of Q1FY18 numbers growing across all products and segments amid a very tepid market due to disruption and de-stocking caused by GST roll out. Net sales for the quarter ended June 2017 were Rs. 7435 Mn as against Rs. 5966 Mn in Q1FY17 representing 24.6% YoY growth in value terms.

Strong Growth Prospects with New Product Lines Net sales for Q4FY17 were Rs. 7846 Mn as against Rs. 7119 Mn representing 10.2% YoY growth in value terms. In volume terms, there was a marginal growth in electrical cables; whereas in communication cables, there was a growth of more than 30.0%. Profit before tax for the quarter has reached Rs.1023Mn as comparedto Rs. 1140 Mn in Q4FY16 showing a decline of 10.3%.

Outshines on Lower Raw Material Prices: Net sales for Q2FY17 were Rs. 6142 Mn as against Rs. 6405 Mn for Q2FY16 representing a 4.1% YoY decline in value terms. The low growth in sales was primarily due to fall in pricing. In volume terms, however there was a 18.0% growth in Electrical cables, 2.0% growth in high voltage power cables and in communicationcables there was a growth of more than 12.0%.

Standalone net sales for Q4FY16 were Rs.6807 mn as against Rs.6582 mn representing 3.4% YoY growth in value terms. The low growth in sales was primarily due to fall in commodity prices. In volume terms, however there was a 12.0% QoQ growth in Electrical cables; and in the communication cables, there was a QoQ growth of more than 20.0%. Profit before tax for Q4FY16 has reached Rs.1106mn as compared to Rs.683 mn in Q4FY15 showing a growth of 61.9%.Karvy maintain "BUY" rating for a upward revised target price of Rs.412 representing an upside potential of 20% for a 9-12 months period.

Trendlyne has 8 reports on FINCABLES updated in the last year from 3 brokers with an average target of Rs 385.5. Brokers have a rating for FINCABLES with 1 price downgrade and 1 price upgrade in past 6 months.

Standalone net sales for Q4FY16 were Rs.6807 mn as against Rs.6582 mn representing 3.4% YoY growth in value terms. The low growth in sales was primarily due to fall in commodity prices. In volume terms, however there was a 12.0% QoQ growth in Electrical cables; and in the communication cables, there was a QoQ growth of more than 20.0%. Profit before tax for Q4FY16 has reached Rs.1106mn as compared to Rs.683 mn in Q4FY15 showing a growth of 61.9%.