{"id":156553,"date":"2023-11-22T06:14:31","date_gmt":"2023-11-22T11:14:31","guid":{"rendered":"https:\/\/44.250.171.167\/?p=156553"},"modified":"2023-11-22T06:14:33","modified_gmt":"2023-11-22T11:14:33","slug":"finolex-cables-ltd-q2-fy24-earnings-conference-call-insights","status":"publish","type":"post","link":"https:\/\/alphastreet.com\/india\/finolex-cables-ltd-q2-fy24-earnings-conference-call-insights\/","title":{"rendered":"Finolex Cables Ltd Q2 FY24 Earnings Conference Call Insights"},"content":{"rendered":"<p><strong>Key highlights from Finolex Cables Ltd (FINCABLES) Q2 FY24 Earnings Concall<\/strong><\/p>\n<ul>\n<li><strong>Financial Performance<\/strong>\n<ul>\n<li>Revenue up 9% this quarter compared to previous quarter.<\/li>\n<li>Gross margin improved to 23% this quarter from 21% last quarter.<\/li>\n<li>Quarterly profits at $165 crores and 21% higher than $136 crores in same quarter last year<\/li>\n<li>Recognized one-time profit of $12.5 crores related to JV liquidation.<\/li>\n<\/ul>\n<\/li>\n<li><strong>Segment Performance<\/strong>\n<ul>\n<li>Electrical wires volume grew 10%.<\/li>\n<li>Power cables volume increased 37% versus low base last year.<\/li>\n<li>Communication cables soft as expected government tenders not yet released, now expected in Dec\/Jan.<\/li>\n<li>New lighting and conduit products seeing good volumes and order intake.<\/li>\n<li>Appliance lines muted due to lingering consumer impact of inflation.<\/li>\n<\/ul>\n<\/li>\n<li><strong>CapEx Plans<\/strong>\n<ul>\n<li>E-Beam project to be completed by end of Q1 2024.<\/li>\n<li>Preform project building to be done by June 2024.<\/li>\n<li>INR400 cr outlay over next 12-18 months.<\/li>\n<li>Typical trigger is 75-80% utilization before next expansion.<\/li>\n<li>Equipment installation\/testing\/commissioning to complete by Sep-Nov 2024.<\/li>\n<li>Additional fiber optic cable capacity projects ongoing.<\/li>\n<li>Building ready, spending will follow equipment delivery.<\/li>\n<\/ul>\n<\/li>\n<li><strong>Distributor Count<\/strong>\n<ul>\n<li>Count reduced from 689 in Feb 2023 to 600 in annual report.<\/li>\n<li>Housekeeping to remove non-performing distributors.<\/li>\n<li>Back to around 700 distributors now at end of September.<\/li>\n<\/ul>\n<\/li>\n<li><strong>Performance vs. Peers<\/strong>\n<ul>\n<li>Finolex has 1-1.5% share of power cable market vs peers with much larger share.<\/li>\n<li>Peers growth figures include power cables, not apples-to-apples comparison.<\/li>\n<li>Finolex has 22% share of organized wire market and performing well there.<\/li>\n<\/ul>\n<\/li>\n<li><strong>Margin Improvement and Working Capital<\/strong>\n<ul>\n<li>Further 1% possible if input prices remain stable.<\/li>\n<li>Brought down cost of goods sold from 81% to 75% over past year through efficiency gains, inventory gains, purchasing gains, product margin improvements.<\/li>\n<li>Working capital currently at 35-40 days.<\/li>\n<li>Working with consultant to optimize inventory and availability.<\/li>\n<li>50 days sustainable target.<\/li>\n<\/ul>\n<\/li>\n<li><strong>Optical Fiber Cable Growth<\/strong>\n<ul>\n<li>Growth contingent on government and private spending.<\/li>\n<li>Spending currently muted but essential for 5G and connectivity.<\/li>\n<li>Continuing investments to be prepared for future tenders.<\/li>\n<li>Prices currently around $3.15 per fiber kilometer.<\/li>\n<li>Expect prices to stabilize and possibly increase in next 3-6 months.<\/li>\n<\/ul>\n<\/li>\n<li><strong>5G Network Investment<\/strong>\n<ul>\n<li>Telcos have budgeted but spending less than expected.<\/li>\n<li>Dense fiberization needed to realize full 5G potential.<\/li>\n<li>Spending can be delayed short term but essential long term.<\/li>\n<\/ul>\n<\/li>\n<li><strong>Margin Outlook<\/strong>\n<ul>\n<li>Targeting 14% margin in electrical cables segment.<\/li>\n<li>Hit 13% last quarter, 14.25% this quarter.<\/li>\n<li>Believe around 14% is sustainable level.<\/li>\n<\/ul>\n<\/li>\n<li><strong>Capacity Utilization and Volume Trends<\/strong>\n<ul>\n<li>Currently above 60% overall.<\/li>\n<li>Expanding in higher utilization areas like appliance cables.<\/li>\n<li>Power cables volume up 37%.<\/li>\n<li>Wires up 10%, lower than Q1.<\/li>\n<li>Wires sales expected to improve as construction projects complete.<\/li>\n<\/ul>\n<\/li>\n<\/ul>\n","protected":false},"excerpt":{"rendered":"<p>Key highlights from Finolex Cables Ltd (FINCABLES) Q2 FY24 Earnings Concall Financial Performance Revenue up 9% this quarter compared to previous quarter. Gross margin improved to 23% this quarter from 21% last quarter. Quarterly profits at $165 crores and 21% higher than $136 crores in same quarter last year Recognized one-time profit of $12.5 crores [&hellip;]<\/p>\n","protected":false},"author":1767,"featured_media":154818,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"jetpack_post_was_ever_published":false,"footnotes":"","jetpack_publicize_message":"","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":true,"jetpack_social_options":{"image_generator_settings":{"template":"highway","default_image_id":0,"font":"","enabled":false},"version":2}},"categories":[9825,392,5753],"tags":[10487,10169,9478],"class_list":["post-156553","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-earnings-call-highlights","category-earnings","category-industrials","tag-cables","tag-earnings","tag-industirals"],"jetpack_publicize_connections":[],"jetpack_featured_media_url":"https:\/\/alphastreet.com\/india\/wp-content\/uploads\/2023\/10\/CC_Image_1.jpg","jetpack_likes_enabled":false,"jetpack-related-posts":[{"id":169101,"url":"https:\/\/alphastreet.com\/india\/finolex-cables-ltd-q4fy25-3-rise-in-profits\/","url_meta":{"origin":156553,"position":0},"title":"Finolex Cables Ltd Q4FY25; 3% rise in Profits","author":"Divyansh_Kasana","date":"July 11, 2025","format":false,"excerpt":"Finolex Cables Limited is a leading manufacturer of electrical and telecommunication cables in India. 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