Investors in Polycab India Ltd stock must brace for a softer March quarter (Q4FY26), potentially slowing what has otherwise been a standout year. Consolidated revenues for the first three quarters of FY26 (9MFY26) rose 30% year-on-year to ₹20,020 crore.
In fact, Q3FY26 revenue growth was as high as 46%, led by a 54% jump in its mainstay wires and cables business that contributes 88% of the gross segment revenues.
Like peers, supply chain uncertainties and demand disruptions following the Middle East conflict are expected to hurt Polycab too. “March so far has been weaker versus initial expectations, thereby impacting Q4 estimates, emanating from uncertainty from the ongoing Middle East conflict, and a high base,” wrote JM Financial Institutional Securities’ analysts after interacting with Polycab’s executives in a report on 15 March.
Should the ongoing uncertainty persist, Q4 volumes could remain flat year-on-year, revenue growth relying on input cost appreciation (18-20%), it added.
March usually accounts for 45-50% of Polycab’s fourth-quarter revenue, but demand has been slower this time owing to uncertainty around commodity prices and project visibility. Exports have also been disrupted. Exports contributed 6% of 9MFY26 total sales, while the Middle East formed 20–22% of the export mix.
Sure, the ongoing weakness could be temporary. “In our view, the current demand softness is largely transitory and represents only a timing shift in demand, which could translate into stronger execution in the coming quarters,” said ICICI Securities analysts in 15 March report.
Copper concerns
Polycab’s other big problem is the uncertainty around copper prices and their impact on the wires and cables sector. Recent stronger-than-expected economic data from China, the world’s largest consumer of copper, has raised concerns on copper demand and prices. This matters for Polycab because copper accounts for 45-50% of its total raw material costs, thereby having a significant bearing on margins.
Copper prices had increased sharply by about 21% QoQ in Q3FY26, which meant Polycab’s Ebitda margin contracted 112 basis points to 12.7%, down from 15.4% in Q2FY26. The company took partial price hikes last quarter to protect sales volume and market share, even if it meant accepting an interim margin hit.
Price hikes have been taken in Q4FY26 as well, which should support realization and value growth for the quarter. If commodity prices remain steady, the benefit of price pass-through should start to show in margins from Q1FY27.
Beyond that, volume recovery and market share expansion will depend largely on Polycab’s distribution strength and product strategy. The company has one of the largest distribution networks in the industry – over 4,500 distributors and 200,000 retail touchpoints across India. It is expanding further into tier-2 and tier-3 cities and also plans to raise marketing spends from 1.5% of B2C sales now to 3-5% to strengthen its brand.
Another important growth driver is Polycab’s push into fast moving electrical goods (FMEG) such as fans, switches and lighting products. These products help extract more gains from the existing distribution network.
Polycab’s shares have dropped a sharp 17% since 27 February, after the Middle East conflict began. The stock trades at 29 times its FY28 estimated EPS, as per Bloomberg. The stock may remain range-bound until there is clearer evidence of volume recovery and margin expansion.