Polycab India has recently experienced a remarkable 18% surge in its stock price over the past month, driven by a robust fourth-quarter performance and an optimistic outlook for fiscal year 2026. This positive trajectory has led brokerage firm Nuvama to uphold a ‘Buy’ rating on the stock, setting a target price of ₹7,410 per share, which indicates a potential upside of 26% from current levels. Nuvama’s confidence in Polycab stems from its strategic market positioning and growth initiatives.

Key Factors Behind Nuvama’s Positive Outlook

Strong Performance Across Business Segments

Nuvama’s analysis reveals that Polycab has delivered an impressive performance in the March quarter. Key highlights include:

• A 22% year-on-year increase in the Cables & Wires segment.
• A 33% growth in the Fast-Moving Electrical Goods (FMEG) category.
• An astounding 47% rise in revenue from Engineering, Procurement & Construction.

The brokerage emphasizes that Polycab aims to achieve revenue growth in Cables & Wires at a rate of 1.5 to 2 times the industry growth, while targeting an EBITDA margin of 11-13%.

Nuvama also notes that profitability in the FMEG sector is expected to improve annually, with Polycab positioned to benefit from the increasing demand for premium electrical goods, including fans, lighting, and solar products.

Future-Ready Export Strategy

Although Polycab faced a temporary setback in exports due to the delay of a large order, its export strategy remains solid. Nuvama pointed out:

“Visibility remains robust with a continued focus on expanding into new markets… with the US transition now successfully completed.”

Currently, Polycab exports to 84 countries and aims for exports to account for 10% of its revenue by FY30, up from the current 6%.

Sector Leadership and Competitive Edge

Nuvama highlights that Polycab holds a leading position in its sector, benefiting from various factors that contribute to its superior margins. These include:

• A favorable business mix.
• A pricing premium on products.
• A focus on exports and product diversification.

Polycab’s Stock Performance Overview

The recent surge in Polycab’s stock price reflects a positive market sentiment, with an 18% increase in just one month. However, the stock has seen a 12% decline over the past six months and a 19% drop year-to-date. On an annual basis, the share price has slightly decreased by 0.7%.

In conclusion, with its solid growth strategy and strong quarterly performance, Polycab India is well-positioned for continued success in the competitive electrical goods market. Whether you’re considering investing in Polycab or simply tracking market trends, the company’s future looks promising.