Polycab India Q2 PAT slips 9.49% to Rs 200.52 cr

The company's consolidated net profit fell 9.49% to Rs 200.52 crore on 48.03% increase in net sales to Rs 3128.83 crore in Q2 September 2021 over Q2 September 2020.

Profit before tax (PBT) fell 7.51% to Rs 266.33 crore in Q2 September 2021 over Q2 September 2020. EBITDA fell 3.11% year-on-year to Rs 302.50 crore during the quarter.

EBITDA margin stood at 9.7% in Q2 September 2021, higher than 7.3% in Q1 June 2021. It is lower than 14.8% reported in Q2 September 2020.

During the quarter, the company's cost of goods sold increased 62.31% year-on-year to Rs 2,455.40 crore. Employee benefit expense rose 19.43% to Rs 107.14 crore.

The company reported broad based growth across segments and markets. Wires and cables business grew 46% on YoY basis to Rs 2548.10 crore in Q2FY22 from Rs 1740.80 crore in Q2FY21. Overall demand environment continued to stage a sequential recovery. Growth was broadly uniform across cables and wires. Domestic distribution driven business sustained its healthy growth momentum while institutional business remained subdued. Exports business grew 12% YoY contributing 8% to overall revenue in Q2FY22.

FMEG business grew 41% YoY to Rs 342.9 crore in Q2FY22 from Rs 244 crore in Q2FY21 underpinned by strategic interventions, distribution expansion and improving demand environment. Fans business was affected during the quarter on account of delayed monsoon. Lights, switches, conduit pipes and pumps business posted healthy growth while other businesses including switchgears, solar and water heaters were about 2x on last years base.

As of 30 September 2021, net cash position stood at Rs 877.30 crore, 27% higher than same period last year.

Commenting on the performance, Inder T. Jaisinghani, chairman and managing director, Polycab India, said: "We had a healthy Q2. Robust sales growth was underpinned by market share gains across categories. Given the strengthening macroeconomic fundamentals, we see a massive opportunity to spread our wings across B2B as well as B2C categories by leveraging on our strong brand equity and increased consumers affinity for our products. Structural reforms focussed on infrastructure development augurs well for most of our product categories. We are also in the process of building Polycab of the future. A company with robust governance practices, top talent, a strong business model, a customer centric culture and a purpose to serve the communities. We will strive to continue the path of profitable and sustainable growth and contribute to the success of all our stakeholders."

Polycab India is a leading electricals brand. It is the largest manufacturer of wires and cables in India and on of the fastest growing player in the FMEG space. The company manufactures and sells various types of cables, wires, electric fans, LED lighting and luminaires, switches and switchgears, solar products, pumps and conduits and accessories.

Shares of Polycab India were up 1.38% at Rs 2254.45. The stock reversed trend after falling as much as 4.53% in the intraday today.

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