Finolex Cables targets Rs 500 cr revenue from new vertical by fiscal 2022

The company is eyeing at least Rs 500 crore revenue from its new consumer-facing electrical accessories business by the next fiscal.

The largest electrical and telecom cables maker Finolex Cables is eyeing at least Rs 500 crore revenue from its new consumer-facing electrical accessories business by the next fiscal when it expects total revenue to sniff past Rs 3,500 crore, a top company official has said.

Currently, net sales from the Pune-based firm's new segment, which includes a range of ceiling, table, wall, industrial heavy-duty exhaust, and multi-purpose fans, water heaters, LED- PC panels, cabinet lights and MCCBs, are only under 4 per cent.

Finolex entered the new business two years ago with a range of fans and last month it launched anti-bacteria ceiling fans, claiming it be the first in the country.

Its staple electrical cables, which is dominated by house wiring, chip in with 60 per cent of the revenue, 20 per cent is contributed by agri and automobile wires and another 20 per cent comes from power cables and around 12 per cent comes from telecom cables, Deepak Chhabria, chairman of Finolex Cables told PTI.

The new business is clipping at high double digits. Currently it contributes only under 4 per cent of the topline, but we want to focus on this business more and increase revenue contribution to around 15 per cent or around Rs 500 crore by FY2022, Chhabria said, adding by then the company should be a Rs 3,500 crore entity.

The company which is into a legal battle with another family entity Finolex Industries closed FY2020 with a little over Rs 3,000 crore in topline, and Chhabria will be happy to close the current fiscal at that level as it has nearly lost the entire first quarter to the coronavirus pandemic.

Everything depends on how the third and fourth quarters behave, he says, adding if the second quarter growth is carried into the second half then the company will be able to make up the losses in the first half when it lost over 11 per cent of the revenue year-on-year.

He said despite the lockdown, the company has not scaled down or slowed the Rs 200-crore capex plan which is underway in the Urse plant near Pune where they will make radiation technology-based solar cables, auto wires for the engines instrumentation cables using thin copper wires and telecom fibres for residential use as the lockdown lingers on, Chhabria said.

He said the worst performer was the telecom cables business, revenue from which plunged over 36 per cent in the first half, but since Q2 there has been demand revival from the sector but a new category-- optical fibres for residential use as the lockdown lingers on.

He also said to protect the margin, which is normally 12 per cent, they will increase prices of all its products by at least 3 per cent by next week as PVC and other key inputs have been going up for the past few months.

Established in 1958, Finolex Cables employs over 1,760 employees across it five manufacturing sites at Pimpri and Urse near Pune, Goa, and Roorkee in Uttarakhand.