Telecom - Services
Valuation | |
|---|---|
| Market Cap | 10.8 kCr |
| Price/Earnings (Trailing) | 374.35 |
| Price/Sales (Trailing) | 2.85 |
| EV/EBITDA | 31.12 |
| Price/Free Cashflow | 67.01 |
| MarketCap/EBT | 187.46 |
| Enterprise Value | 12.32 kCr |
Fundamentals | |
|---|---|
| Revenue (TTM) | 3.79 kCr |
| Rev. Growth (Yr) | -4.6% |
| Earnings (TTM) | 31.9 Cr |
| Earnings Growth (Yr) | -1.9% |
Profitability | |
|---|---|
| Operating Margin | 2% |
| EBT Margin | 2% |
| Return on Equity | 0.76% |
| Return on Assets | 0.40% |
| Free Cashflow Yield | 1.49% |
Growth & Returns | |
|---|---|
| Price Change 1W | 1.8% |
| Price Change 1M | 2.2% |
| Price Change 6M | 1% |
| Price Change 1Y | -40.1% |
| 3Y Cumulative Return | -2.2% |
| 5Y Cumulative Return | 34.5% |
| 7Y Cumulative Return | 19.7% |
| 10Y Cumulative Return | 17.1% |
Cash Flow & Liquidity | |
|---|---|
| Cash Flow from Investing (TTM) | -518.39 Cr |
| Cash Flow from Operations (TTM) | 396 Cr |
| Cash Flow from Financing (TTM) | 169.58 Cr |
| Cash & Equivalents | 29.43 Cr |
| Free Cash Flow (TTM) | 165.83 Cr |
| Free Cash Flow/Share (TTM) | 1.15 |
Balance Sheet | |
|---|---|
| Total Assets | 7.96 kCr |
| Total Liabilities | 3.78 kCr |
| Shareholder Equity | 4.18 kCr |
| Current Assets | 5.67 kCr |
| Current Liabilities | 3.16 kCr |
| Net PPE | 824.81 Cr |
| Inventory | 1.15 kCr |
| Goodwill | 26.17 Cr |
Capital Structure & Leverage | |
|---|---|
| Debt Ratio | 0.19 |
| Debt/Equity | 0.37 |
| Interest Coverage | -0.73 |
| Interest/Cashflow Ops | 3 |
Dividend & Shareholder Returns | |
|---|---|
| Dividend/Share (TTM) | 0.1 |
| Dividend Yield | 0.13% |
| Shares Dilution (1Y) | 0.00% |
| Shares Dilution (3Y) | 4.7% |
Summary of HFCL's latest earnings call, featuring management's outlook on business performance, financial results, and analyst Q&A sessions that highlight key strategic initiatives and market challenges.
Last updated:
In the earnings call for the second quarter of FY26 on October 17, 2025, management provided an optimistic outlook for HFCL, emphasizing growth across several sectors. They foresee strong demand in both optical fiber cables and defense products, driven by a significant increase in data consumption and government initiatives toward self-reliance in defense manufacturing.
Key forward-looking points include:
Revenue Guidance: Management is maintaining a revenue growth guidance of approximately 20% for the fiscal year, with an expectation to see continued revenue increases stemming from ongoing expansions and new contracts.
Optical Fiber Cable Expansion: HFCL is expanding its manufacturing capacity from 1.73 million fiber kilometers per annum to 19.01 million by June 2026, aiming for a total capacity of 42.36 million fiber kilometers per annum. This positions the company among the top global manufacturers.
Financial Performance:
Defense Opportunities: Management highlighted expected revenues from the defense sector to reach approximately INR 200 Crores in FY26, with projections of over INR 500 Crores in FY27, and potential to exceed INR 1,000 Crores in subsequent years due to multiple product lines under development.
Order Book: As of September 30, 2025, the order book stands at INR 9,981 Crores, indicating healthy future revenue streams.
Market Trends: Management noted that the demand for optical fiber is expected to maintain a strong CAGR of approximately 22.39% over the next five years, correlating with increased smartphone usage and OTT consumption, alongside a resurgence in global demand for Optical Fiber Cable (OFC).
These points exemplify HFCL's strategic focus on innovation, capacity expansion, and positioning to meet growing domestic and global market demands.
Last updated:
1. Question: What will be the impact of U.S. tariffs on our business? Are we maintaining our 20% guidance on revenue for this year?
Answer: Yes, we are maintaining our 20% revenue guidance. You will see an increase in revenue in the current quarter. Regarding the U.S. tariffs, we have managed to minimize their impact legally, ensuring minimal effect on HFCL's exports, primarily optical fiber cables to the U.S. Although tariffs exist, they are not severely detrimental to our business.
2. Question: Can you discuss how HFCL is positioned in the defense sector and its expected revenues?
Answer: The defense market is poised for robust growth due to government emphasis on self-reliance. We expect approximately INR 200 crore in revenue this fiscal year from defense, with projections exceeding INR 500 crore next year and possibly reaching 4 figures later. Our ongoing projects include significant contracts for electronic fuzes and radar systems, which will enhance our position within the ecosystem.
3. Question: What margins can we expect in the defense segment?
Answer: Margins in the defense market are generally better than standard communication products, averaging around 15%. However, they can vary between 10% to 25%, depending on the product.
4. Question: Could you elaborate on the passive connectivity solutions being developed for hyperscale data centers?
Answer: We're developing multiple passive connectivity solutions, including MPO cable solutions for rack-to-rack connectivity. We anticipate that our revenue from these passive solutions, currently around INR 400 crore, could reach over INR 1,000 crore in the next financial year due to increasing demand from hyperscale data centers.
5. Question: What should we expect regarding pricing trends for optical fiber and cable?
Answer: The pricing for fiber optic cables has improved, increasing from INR 850 to INR 950 per kilometer recently. This upward trend, driven by heightened demand from both data centers and telcos, is expected to continue, reflecting a strong demand-supply dynamic.
6. Question: How is capacity utilization currently?
Answer: Our current capacity utilization stands at around 90%, and we are actively expanding our capacity to meet growing demand.
7. Question: What are HFCL's plans for future expansions, especially in defense capabilities?
Answer: We are expanding our defense capabilities significantly, including the establishment of a facility in Andhra Pradesh for manufacturing ammunition. This, along with trials for various defense products, positions us for substantial revenue growth in the coming years.
8. Question: What is the expected contribution of O&M (operation and maintenance) contracts?
Answer: O&M contributions are expected to increase starting next year, with margins anticipated around 20%. Currently, O&M has minimal contribution as major contracts will kick in from the next fiscal year.
9. Question: How do we perceive the impact of competition from Chinese products?
Answer: China is less of a competitive threat in developed markets like the U.S. and Europe, mainly due to geopolitical concerns. Consequently, HFCL is well-positioned in current markets, not significantly impeded by Chinese suppliers.
These detailed answers encapsulate the strategic insights, financial expectations, and operational strategies discussed during the call.
Analysis of HFCL's financial performance, highlighting revenue trends, growth patterns, and key metrics through quarterly analysis.
Last Updated: Sep 30, 2025
| Description | Share | Value |
|---|---|---|
| Telecom Products | 51.4% | 536.6 Cr |
| Turnkey Contracts and Services | 48.6% | 506.8 Cr |
| Total | 1 kCr |
Understand HFCL ownership landscape with insights into key distribution patterns, offering investors a clear view of stakeholder dynamics.
| Shareholder Name | Holding % |
|---|---|
| MN VENTURES PRIVATE LIMITED | 14.77% |
| NEXTWAVE COMMUNICATIONS PRIVATE LIMITED | 13.51% |
| QUANT MUTUAL FUND - QUANT BUSINESS CYCLE FUND | 6.72% |
| RELIANCE STRATEGIC BUSINESS VENTURES LIMITED | 3.36% |
| Reliance Ventures Limited | 1.57% |
| FITCORE TECH-SOLUTIONS PRIVATE LIMITED | 1.54% |
| MAHENDRA NAHATA | 0.09% |
| VINSAN BROTHERS PRIVATE LIMITED | 0.05% |
| ANANT NAHATA | 0.04% |
| SHANKAR SALES PROMOTION PRIVATE LIMITED | 0.02% |
| AARIV NAHATA | 0% |
| KAMAL OSWAL | 0% |
| KRISHIV NAHATA | 0% |
| MANISHA OSWAL | 0% |
| NEHA NAHATA | 0% |
| PRIYANKA SANGHI | 0% |
| PUSHPA DEVI MALOO | 0% |
| DHANPAT SINGH CHORARIA | 0% |
| KANCHAN DEVI CHORARIA | 0% |
| BIJAY KUMAR CHORARIA | 0% |
Distribution across major stakeholders
Distribution across major institutional holders
Detailed comparison of HFCL against industry peers, highlighting key financial metrics, valuation ratios, and performance indicators to provide competitive context within the sector.
Ticker | Name | Mkt Cap | Revenue | Price %, 1M | Returns, 1Y | P/E | P/S | Rev 1-Yr | Inc 1-Yr |
|---|---|---|---|---|---|---|---|---|---|
| TEJASNET | Tejas Networks | 9.24 kCr | 5.05 kCr | -11.30% | -61.80% | -22.7 | 1.83 | - | - |
| STLTECH | Sterlite Tech | 5.6 kCr | 4.41 kCr | -2.60% | -6.00% | -110.37 | 1.27 | - | - |
| VINDHYATEL | Vindhya Telelinks | 1.61 kCr | 4.15 kCr | -1.10% | -36.00% | 6.93 | 0.39 | - | - |
| PARACABLES | Paramount Communications | 1.27 kCr | 1.73 kCr | -4.80% | -43.40% | 15.8 | 0.73 | - | - |
Comprehensive comparison against sector averages
HFCL metrics compared to Telecom
| Category | HFCL | Telecom |
|---|---|---|
| PE | 374.35 | 99.33 |
| PS | 2.85 | 4.91 |
| Growth | -19.3 % | 16.3 % |
HFCL Limited manufactures and sells telecom products in India and internationally. It operates in Telecom Products; and Turnkey Contracts and Services segments. The company offers optical fiber cables, such as underground, aerial, microduct, FTTH, and micromodule cables; telecom products and solutions, which includes unlicensed band backhaul radios, Wi-Fi access points, routers, managed switches, antennas, network management solutions, and 5g product portfolio; defence product portfolio comprising electronic fuzes, electro optics, high capacity radio relay, software defined radios, and ground surveillance radars; and passive networking components includes high density cabinets, joint closures, optical splitters, aerial cable accessories, fiber optic cable assemblies, and copper cable assemblies. It provides network solutions for public telecommunications, defence and railway communications, and system integration services. The company has a collaboration agreement with Qualcomm Technologies, Inc. for developing 5G RAN and access products. The company was formerly known as Himachal Futuristic Communications Limited and changed its name to HFCL Limited in October 2019. HFCL Limited was incorporated in 1987 and is based in New Delhi, India.
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HFCL vs Telecom (2021 - 2025)