Polycab India Ltd. is making waves in the stock market with a robust ‘buy’ recommendation and a target price set at Rs 6,485, indicating a potential upside of 29.18% from its closing price on Monday. This favorable outlook comes from Jefferies, which has identified Polycab alongside other key players in the small and midcap sector, including Amber Enterprises, Voltas, and Crompton Greaves Consumer Electricals. Recent market corrections present a golden opportunity for investors to reassess their portfolios in this space.
Small and Midcap Stocks: A Market Overview
In the calendar year 2025, small and midcap stocks in India have seen a sharper decline than larger counterparts. According to Jefferies, the NSE Midcap index dropped by 16% year-to-date, contrasting with a more modest 5% decrease in the NSE Nifty 50. The brokerage remains optimistic about sectors like emergency medical services and capital expenditure-dependent industries, projecting a rebound in capital spending during the first half of CY2025.
- Key insights from Jefferies:
- Strong potential for capital expenditure recovery.
- Revenue management will be crucial for small and midcap firms.
Polycab India: Growth Prospects
Jefferies forecasts no adverse effects on Polycab’s financials for the fiscal years 2025 to 2027. They predict a 22% sales growth and a 28% increase in profits during this period. This growth trajectory is expected to be fueled by a surge in demand for cables, wires, and fast-moving electrical goods.
The company’s strong market position is supported by an extensive stock-keeping-unit count and a well-established distribution network, which have contributed to its significant market share gains.
Amber Enterprises: A Promising Investment
Amber Enterprises India Ltd. is another stock that has caught Jefferies’ attention, earning a ‘buy’ rating with a target price of Rs 8,845, suggesting a possible upside of 36.1%. The company is poised to achieve over 30% sales growth and 36% EBITDA growth from FY 2025 to 2027. With the introduction of a 30% anti-dumping duty on printed circuit boards in 2024, Amber is expected to attract new customers in the electronics sector.
- Key points for Amber Enterprises:
- Potential for capital expenditure normalization.
- Growth driven by demand in the domestic air conditioning market.
Crompton Greaves Consumer Electricals: Strong Performance Ahead
Crompton Greaves Consumer Electricals Ltd. holds a ‘buy’ rating with a target price of Rs 480, indicating a 36.13% upside. Jefferies anticipates a 22% CAGR in earnings per share from FY 2024 to 2027. The company is maintaining robust growth across its engineering, capital, and design sectors, especially in lighting.
Management expects double-digit growth in premium products this summer, signaling strong market demand.
Voltas: Expected Growth in the Air Conditioning Sector
Jefferies also recommends Voltas, with a target price set at Rs 1,990, reflecting a 36.35% upside. The company is projected to achieve over 21% sales and 31% net profit CAGR through FY 2025 to 2027, driven by increased sales in room air conditioning and a turnaround in EPC margins.
- Voltas’ growth drivers include:
- Anticipated demand growth of 25-30% in the domestic air conditioning market.
- Normalization of growth expected in the fourth quarter of FY 2025.
Conclusion
Investors looking for opportunities in the small and midcap sector should consider Polycab India Ltd. and its peers, as they show strong potential for growth amidst recent market fluctuations. With favorable ratings and promising forecasts, these companies could be the key to unlocking substantial returns in the coming years.
