Finolex Cables Limited, one of India’s leading manufacturers of electrical and communication cables, posted mixed financial results for Q1 FY26. On 12 August 2025, the company reported:
-
Consolidated revenue of ₹1,395.52 crore, up 13.41% YoY.
-
Consolidated PAT of ₹162.62 crore, down 33.33% YoY.
While sales growth was strong, consolidated profitability saw a steep decline, likely due to one-off factors or margin pressures from non-core operations. Interestingly, standalone operations posted both higher revenue and profit growth, pointing to divergence between core and consolidated performance.
1. Financial Performance Overview
Consolidated Q1 FY26 vs Q1 FY25
| Particulars | Q1 FY26 (₹ Cr) | Q1 FY25 (₹ Cr) | Change (%) |
|---|---|---|---|
| Revenue from Operations | 1,395.52 | 1,230.48 | +13.41% |
| Profit Before Tax (PBT) | 190.50 | 173.15 | +10.02% |
| Profit After Tax (PAT) | 162.62 | 243.92 | -33.33% |
Key Observations:
-
Strong revenue growth of over 13% YoY, indicating healthy demand in core product lines.
-
PBT increased 10%, suggesting operational gains before tax adjustments.
-
PAT decline of one-third points to possible exceptional items, higher taxes, or losses from subsidiaries.
Standalone Q1 FY26 vs Q1 FY25
| Particulars | Q1 FY26 (₹ Cr) | Q1 FY25 (₹ Cr) | Change (%) |
|---|---|---|---|
| Revenue from Operations | 1,395.52 | 1,230.48 | +13.41% |
| Profit Before Tax (PBT) | 184.89 | 166.68 | +10.93% |
| Profit After Tax (PAT) | 138.82 | 122.51 | +13.31% |
Key Observations:
-
Standalone profit growth in line with revenue increase suggests that the core cable business remains robust.
-
Divergence between standalone and consolidated profits indicates that non-core operations or associates weighed down overall results.
2. Revenue Drivers
While detailed segmental data wasn’t disclosed, Finolex Cables typically earns revenue from:
-
Electrical Cables – Wires and cables for power distribution and industrial applications.
-
Communication Cables – Optical fiber cables, LAN cables, coaxial cables.
-
Switchgear & Accessories – Electrical switches, sockets, lighting products.
Likely Q1 FY26 trends:
-
Increased demand from infrastructure, housing, and industrial projects.
-
Growth in optical fiber cable demand from telecom and broadband expansion.
-
Stable or rising average selling prices due to raw material cost pass-through.
3. Profitability and Margins
Consolidated PAT Margin: 11.65% in Q1 FY26 vs 19.82% in Q1 FY25 — steep drop.
Standalone PAT Margin: 9.94% in Q1 FY26 vs 9.96% in Q1 FY25 — stable.
Margin Impact Factors:
-
Consolidated margin decline likely due to higher tax provisions or one-time charges.
-
Standalone margins steady, suggesting the core manufacturing business remains insulated from major cost shocks.
4. Year-on-Year Trends
-
Last year, Q1 FY25 saw high consolidated profits, possibly from exceptional gains or favourable subsidiary performance.
-
FY26’s first quarter highlights operational strength but with a sharp dip in bottom line on a consolidated basis.
5. Share Price Performance and Market Reaction
12 Aug 2025 Trading:
-
Opening Price: ₹849.00
-
Current Price: ₹839.00 (down ~1.18% intraday).
Long-term returns:
-
1-Year: -42.44% (significant correction from prior highs).
-
5-Year: +199.86% (near tripling of investor wealth).
-
All-time: +3,838.97% (exceptional wealth creation over decades).
The muted price reaction suggests that the market may have anticipated the dip in consolidated profits or is waiting for management clarity on the earnings divergence.
6. Industry Context
The cables and wires industry in India is benefiting from:
-
Government Infrastructure Push: Power distribution, metro rail, and smart city projects.
-
Housing and Real Estate Revival: Driving demand for low-voltage electrical cables.
-
Digital Connectivity Drive: Expanding demand for data and telecom cables.
Challenges remain in the form of raw material price volatility (copper, aluminium) and competitive pricing pressures.
7. Risk Factors
-
Fluctuating copper and PVC prices impacting cost structures.
-
Slowdown in construction or industrial activity affecting demand.
-
Competitive pricing from unorganized players in domestic markets.
-
Dependency on certain large institutional clients.
8. Strategic Outlook for FY26
Finolex Cables is likely to focus on:
-
Strengthening product mix towards high-margin specialty cables.
-
Expanding market share in telecom and optical fiber segments.
-
Leveraging infrastructure growth in Tier 2 and Tier 3 cities.
-
Exploring export opportunities to diversify revenue streams.
Base case: High single-digit to low double-digit revenue growth for FY26 with stable standalone margins; consolidated margin recovery dependent on subsidiary performance.
Conclusion
Q1 FY26 for Finolex Cables presents a contrasting picture — the core cable business is performing strongly with solid sales growth and steady margins, but consolidated profit has taken a significant hit. For investors, the key question will be whether the consolidated PAT decline is a one-off or a recurring issue.
If the company can sustain double-digit sales growth while resolving non-core profitability challenges, it could be positioned for a more balanced and profitable FY26.
