Polycab shares rise 5% on Jefferies' bullish note that sees 19% upside potential

Mumbai, June 23, 2025 — Shares of Polycab India Ltd. rallied over 5% in intraday trade on Monday after global brokerage Jefferies released a bullish research note, citing strong growth prospects, robust market leadership, and favorable macro tailwinds. The stock surged to ₹6,250 on the BSE, buoyed by renewed investor confidence, with Jefferies projecting a 19% upside from current levels.

Jefferies Turns Bullish: Growth, Margins, and Execution in Focus

Jefferies initiated or reaffirmed its ‘Buy’ rating on Polycab with a target price of ₹7,200, indicating a potential upside of approximately 19% from its current market price. The brokerage emphasized Polycab’s dominant position in the wires and cables segment, and its ability to maintain strong margins despite commodity fluctuations and competitive pressures.

“Polycab's brand strength, distribution depth, and execution capabilities make it a clear beneficiary of India’s accelerating infrastructure and housing growth,” Jefferies stated in its note.

The firm highlighted that Polycab’s well-diversified portfolio, strong free cash flows, and focus on operational efficiency create a resilient long-term investment case.

Strong Fundamentals, Robust Financials

Polycab’s financial performance continues to impress investors. For FY24, the company reported a 25% YoY rise in consolidated net profit to ₹1,475 crore, while revenue increased 18% YoY to ₹16,600 crore. The EBITDA margin improved to 13.2%, aided by operating leverage and efficient cost control.

Analysts note that Polycab commands over 22% market share in India’s organized wires and cables sector, with opportunities to further expand as it deepens its reach in Tier-2 and Tier-3 cities.

“We see a structural story here — this isn’t just a cyclical trade,” said Nirav Mehta, an analyst at a Mumbai-based wealth firm. “Polycab’s ability to scale and innovate, especially in the B2C segment, will likely drive its re-rating.”

Favourable Macros: Capex Cycle, Housing, and Electrification

India’s renewed focus on infrastructure spending, affordable housing, and rural electrification augurs well for Polycab. The government’s capex push in power transmission, metro projects, and smart cities is expected to boost demand for cables and wires.

Additionally, the growing trend of premiumisation in electrical products, supported by rising disposable incomes and real estate revival, is expected to fuel Polycab’s growth in fast-moving electrical goods (FMEG), including fans, lights, and switches.

“India’s wires and cables industry is witnessing a multi-year growth cycle. Polycab, being the market leader, stands to benefit the most,” said Aarti Shah, electricals sector analyst at Motilal Oswal.

Technical View: Near-Term Momentum Builds

From a technical standpoint, Polycab has broken past key resistance levels near ₹6,050, with volume uptick confirming the breakout. Momentum indicators like RSI and MACD show bullish signals, suggesting further upside in the near term.

Traders are now eyeing ₹6,350 as the next resistance, while support is seen near ₹5,950.

“The stock is showing strong momentum, and long build-up is evident in derivatives. Any pullback should be seen as a buying opportunity,” said Ramesh Parekh, a technical analyst at JM Financial.

Investor Outlook: Long-Term Value Play

While near-term sentiment is driven by the Jefferies upgrade, long-term investors are focusing on Polycab’s structural advantages—its dominant market share, strategic brand positioning, and ability to deliver consistent return on equity (ROE), which stands at 21% for FY24.

Despite recent price volatility amid broader market weakness, Polycab has outperformed the Nifty 50, delivering a year-to-date return of over 28%.

With increased institutional interest, Polycab also saw its foreign institutional investor (FII) holding rise to 13.8% in Q4 FY24, up from 12.4% in the previous quarter, indicating growing confidence from global investors.

Jefferies’ bullish stance on Polycab reaffirms the company’s long-term growth potential amid India’s infrastructure boom and rising electrification needs. As fundamentals remain strong and macroeconomic tailwinds support growth, Polycab appears well-positioned to deliver superior returns to long-term investors.