Polycab Q3 preview: PAT may climb 13% YoY; management commentary on tax evasion to be in focus

The cable company Polycab India is slated to report its December quarter (Q3 FY24) earnings on Thursday, January 18, 2024. Zee Business research team expects the company to post consolidated revenue of Rs 4,323 crore for the quarter under review, as against Rs 3,715 crore in the same quarter last year.

Additionally, EBITDA, or earnings before interest, taxes, depreciation, and amortisation, at the company is set to jump higher by 18 per cent year-on-year (YoY) to Rs 593 crore versus Rs 504 crore in the same quarter last year.

The research desk estimates margins to be steady at 14 per cent. PAT, or profit after tax, is also seen climbing 13 per cent on-year during the period under review to Rs 407 crore.

Zee Business desk sees the company’s wires and cables segment posting strong growth on the back of strong demand. Further, a robust export pipeline will also aid growth. The desk also pointed out that while the B2B segment is estimated to post good growth, the company’s FMEG, or fast-moving electrical goods vertical, may see tepid growth.

This effect will be the result of a decline in demand for fans.

Additionally, the company may see an increase in advertising and promotion (A&P)-related expenses. This increased outlay towards expenses would impact the company’s margins.

Key monitorable

Investors should keep an eye on the company’s capacity addition plans. Additionally, the company’s FMEG segment may see new launches. Further, investors need to be watchful about the management’s comment on tax evasion.

Polycab has been in the news lately amid reports of searches by the Income Tax Department on the premises of the company amid unaccounted cash sales worth Rs 1,000 crore. The company's officials have, however, clarified that the search operation would not impact the company’s financials.

The company's shares on Wednesday ended at Rs 4,440.05 on the BSE, up 2.32 per cent.