44% growth masks margin cliff ahead; data center tailwind real but years away

Delivered ₹2,013.2 Cr with +44.3% YoY (matches precisely)

Delivered PAT ₹249 Cr (+79% YoY). Call understated PAT by ₹28 Cr (+12.6% higher delivered)

Confirmed but driven by old cheap fiber inventory (Dec 2025 at USD 5-6/km, selling at USD 12-13/km). Will compress as new cost material consumed

Delivered OPM 14.2% overall; electrical segment ~10.5% sustainable per mgmt; achieves via volume growth and pricing

Confirmed; matches prior year's full-year amount; primarily comm cables (₹35-40 Cr of ₹176 Cr segment)

Prior: 4→6M km (Q2), then 6→8M km (wait-and-see). Now: 4→8M km by Sept 2026 directly. Rationale: AI/datacenter demand surge visible globally; shortage of fiber likely to continue. ₹300 Cr capex unchanged.

Q4 call indicated repricing in H2 FY27. Now confirmed: happened end-June 2026 (already factored into Q1 results). Benefits captured; no further upside from repricing.

Revamped team now focused on exports; exploring US, Europe, multiple geographies for long-term engagement. Q1 ₹50 Cr exports (matches prior year full-year). No quantified target but tone more structured.

30% Q1 margin explicitly hedged by management as temporary (old inventory benefit). Will normalize to 'low double digits' as new cost preforms consumed. Not repeatable; headline margin compression ahead.

FY28 target reaffirmed but Q1 weakness (LPG/PVC supply) raises risk profile. Management states demand intact, supply-side issue only. Recovery timing now uncertain vs prior call's optimistic tone.

Exports high-margin but conservative on sustainability. Electrical ~10.5% sustainable. Comm cable high due to old cheap raw material; will normalize to double digits once consumed.

Volumes up ~30%; price/mix rest. Exports ₹35-40 Cr (20% of ₹176 Cr segment). AI/datacenter driving global demand; exported to US/Europe but unpredictable quarterly.

USD 5-6 (Dec 2025) climbed to USD 17-18 (peak) now settled USD 12-13/km. Premium fibers sold USD 25-50/km. Cannot predict; depends on demand.

Too early. Fuel/helium prices volatile (INR 1,600→5,000→3,400/cubic meter example). Need stabilization period. Could improve vs normalized baseline but cannot quantify with current volatility.

Should be capable of 7,000, 14,000+ fiber designs in not-too-distant future. Yes to both R&D and capex allocation.

Old inventory benefit: sourced Nov-Dec 2025 at X dollars, selling at current high market prices. Margin delta will reduce as new cost preforms consumed. Will be double digits but not 30%.

Fiber 8M km by end Sept 2026. Cabling 8M→10M km (takes longer, no Sept timeline).

Used up all preforms available. Tight market, sourcing difficulties. Essentially 100% of available material consumed.

Will source externally until own facility stabilizes. Germanium issue global (2 of us in India facing same constraint); hand-to-mouth but manageable with daily follow-up. Nobody signs contracts >1 year globally.

Target stands. Q1 was supply-constrained (LPG, PVC). Demand intact, distribution/pricing/competition not the issue. Will recover when supplies normalize.

Cannot quantify. India fiber 25M km/year vs China 400M+. Can easily 2-2.4x to 50-60M km. Demand robust for 2+ years.

We are hoping it would.

Yes; restricted item, long lead time, hand-to-mouth. Have enough for calendar year. Requires daily follow-up. Industry-wide issue (2 players facing same constraint).

No. Said USD 88 million if only fiber at 8M km capacity at USD 11/km. Plus cable value add 25-30%. No ₹3,000 Cr statement.

More systematic. Revamped team focused on exports. Exploring multiple geographies for long-term relationships. Q1 US/Europe opportunistic but building beyond.

Depends on product complexity. Complicated designs (high fiber count) > electrical margins. Simple designs (FTTH, drop cable) < electrical margins.

Mgmt confirmed 44% Q1 growth but cautious on full-year extrapolation given commodity volatility (fiber, copper, fuel). Market-level view (India fiber 25→50-60M km potential) stated but company-level FY27 target not quantified.

Segment margins stable on volume growth + pricing power. No structural shifts expected.

Peak margin driven by old cheap inventory benefit. Will compress as higher-cost preforms consumed. Final normalized level depends on product mix (simple FTTH vs complex datacenter designs).

Includes fiber draw 4→8M km, preform facility stabilization, cabling 8→10M km (later), and ancillary expansion. Funded via internal cash generation.

Germanium tetrachloride (preform critical input) restricted, long lead times globally; hand-to-mouth sourcing required. LPG and PVC also constrained in India. No long-term preform supply contracts available (max 1 year internationally).

Communication cables recorded ~30% margin in Q1, sourced entirely from old cheap fiber inventory (bought USD 5-6/km Dec 2025, sold at USD 12-13/km current). This benefit is temporary; will normalize to 'low double digits' as new cost inventory consumed. Timing and final level uncertain.

FMEG (fans, conduit pipes) weak in Q1 due to commercial LPG/PVC supply constraints (not demand weakness). FY28 ₹5 Bn revenue target reaffirmed, but recovery timing now uncertain if supply headwinds persist.

Fiber capacity 4→8M km by Sept 2026 is aggressive (accelerated from phased 4→6→8 approach). Preform facility stabilization timeline unclear. Cabling 8→10M km expansion timeline 'longer' but unspecified. Any delays impact revenue targets and margin contribution timeline.

Data center opportunity (AI-driven, hyperscaler expansion into India) is structural but deployment phased over 2+ years. Domestic demand not expected in volume until FY29 onwards. Short-term growth reliant on exports and telecom, both unpredictable.

Q1 exports ₹50 Cr match prior year's full-year amount. Management explicitly notes export opportunities 'may not happen every month or every quarter.' Geographies and order timing unpredictable.