Two leading brokerages have issued buy ratings on Polycab India with significantly different target prices. Motilal Oswal maintains a buy rating with a target price of ₹10,600, while Jefferies has set a higher target of ₹11,040, representing a 33% upside potential from current market levels. As per Jefferies, the stock currently trades at 35 times its expected earnings for the next year, which is around 8% below the company's five-year average. The dual buy recommendations reflect strong confidence in the company's growth trajectory despite recent market concerns.
Both brokerages have issued buy ratings following Polycab's impressive Q2FY27 results. According to Motilal Oswal's research report dated October 15, 2026, Polycab's revenue and EBITDA grew 53% and 44% year-on-year respectively to ₹98.9 billion and ₹14.2 billion, beating estimates by 15% and 16% respectively. The cable and wire segment revenue rose 47% YoY to ₹83.8 billion while FMEG revenue jumped 2.2 times YoY to ₹9.9 billion, significantly outperforming expectations. As per Jefferies, cables and wires sales rose 47% from a year ago with domestic sales growing 50% and exports 17%, while FMEG sales more than doubled driven by solar products.
Despite strong revenue growth, Polycab's operating profit margin declined 90 basis points YoY to 14.4% due to a 90 basis points decline in C&W margin to 14.2%, though this was still 90 basis points above estimates. As reported by Motilal Oswal, adjusted profit after tax increased 48% YoY to ₹9.8 billion, aided by higher-than-estimated other income. The margin pressure was primarily pricing-led, with copper prices up 43% year-on-year, which the company passed on to buyers. According to Jefferies, the cables and wires business saw margin fall to 14.2% due to high base effects from the previous year.
The FMEG segment continued to significantly outperform expectations, with margins achieving double digits for the first time, led by strong performance in solar inverters. According to Motilal Oswal's analysis, wire growth outpaced cable growth during the quarter, with management expecting healthy cable and wire demand to remain intact in the second half of FY27. As per Jefferies, FMEG earnings before interest and tax reached about 10% of sales, compared to near 1% a year ago, driven by solar products. The segment's performance was a key driver behind the company's overall strong quarterly results.
The launch of UltraVolt by UltraTech Cement has raised competition concerns in the cables and wires market, with Polycab's share price falling around 20% from its June peak amid these concerns. However, Jefferies believes the threat may be manageable, noting that the new entrant's planned capital expenditure of ₹1,800 crore could translate into a 5-6% share of the cables and wires industry's sales by FY29-30. The brokerage also highlighted that the informal market accounts for around 25% of the industry, leaving room for organised players to expand. Despite competition risks, the industry's net profit margins of 5-7% leave limited room for aggressive price cuts without affecting profitability.
Following the strong earnings beat, both brokerages have revised their estimates upward. Motilal Oswal has increased EPS estimates by 9% and 4% for FY27 and FY28 respectively, while Jefferies expects PAT CAGR of +22% over FY26-FY29, led by volume growth and FMEG margin improvement. The stock currently trades at 34x and 31x FY27E and FY28E EPS respectively. As reported by Jefferies, the company is expected to continue investing around ₹1,500 crore annually over the forecast period, with expansion into extra-high-voltage cables and data centre supplies providing additional growth opportunities.
