Perivis

Summary of earnings call for HFCL Ltd published on 01 Aug, 2025

HFCL Limited
Q1 FY26
Call date · July 25, 2025

1 · Management Commentary

Key Positives

Key Negatives

Forward Guidance

2 · Q&A Highlights

Q 1 (Data Center & OFC Demand): How is HFCL positioned to capture the data center opportunity and what is the outlook for OFC demand and margins?
A (Management):
• Supplying high-capacity fiber optic cables and developing PCS for data centers; revenue from data center PCS to start in FY27.
• OFC demand has rebounded; capacity utilization at or near 100%.
• OFC margins have recovered to ~15% from July onwards, driven by higher demand and improved product mix.

Q 2 (Defence Business & Commercialization): What is the commercialization roadmap for new defence products and expected revenue contribution?
A (Management):
• Revenue from defence to start in Q2 FY26; thermal weapon sights and tactical cables already being supplied.
• Electronic fuzes to undergo DRDO testing in August; revenue could start from Q4 FY26 if successful.
• Defence revenue expected at ₹200+ crores in FY26; facility at Hosur operational for current requirements.

Q 3 (Order Book & Segmental Split): What is the composition of the order book by segment and export/defence share?
A (Management):
• Export order book above ₹400 crores; defence order book ~₹1,300 crores (12% of total).
• EPC (turnkey) orders at ₹6,400 crores; ~₹1,000–1,200 crores expected to be executed in FY26.
• OFC contributes ~65% of product revenue.

Q 4 (Capex, Fundraising & Promoter Holding): What are the plans for capex, fundraise utilization, and promoter stake?
A (Management):
• Capex of ~₹250 crores for FY26, mainly for IBR cable and OFC expansion.
• ₹700 crores fundraise is only an enabling resolution; timing and quantum undecided.
• Promoter holding has reduced for personal/charitable reasons; still above 31%.

Q 5 (BharatNet & Routers): What is the expected revenue from BharatNet and status of indigenous routers?
A (Management):
• BharatNet Phase III to contribute ₹800–1,000 crores in FY26.
• Commercial deployment of routers underway; ₹650 crore order secured, with more expected.

Q 6 (Margins & Profitability): When will margins and profitability normalize?
A (Management):
• Margins have improved from July; OFC margins at ~15%.
• Q2 FY26 expected to be better than Q1; profitability to improve with higher utilization and revenue.

Q 7 (Succession Planning): What is the succession plan for management?
A (Management):
• Company to be run by professional CEOs and business heads; next generation to focus on strategy and governance.

Q 8 (PLI & Other Incentives): Is any PLI income expected in FY26?
A (Management):
• No PLI expected in FY26 due to not meeting indigenization targets.

3 · Other Key Numbers



Note: This is an AI generated summary of the earnings call. There may be inaccuracies in the summary. Please refer to the original transcript before making investment decisions.