Finolex Cables pushes fiber expansion to Q2 FY27, defers pricing upside
Optical fiber draw capacity is delayed, locking the company out of rising global prices for now. Domestic contracts are fixed through June, and management won't guide on margins.
— 2 earlier stories on Finolex Cables Ltd. →What's new
- Optical fiber draw capacity expansion pushed to end-Q2 FY27, delaying a key growth driver.
- Domestic contracts are locked in through June, so the company can't capture higher global fiber prices until they expire.
- Management guided ₹300 cr in capex but refused to forecast margins, citing supply-chain disruptions.
Why this matters
The fiber pricing thesis was a central pillar for FY27 growth. The delay, combined with fixed contracts, means any revenue uplift from rising global prices is now a second-half event at the earliest. Supply-chain volatility leaves margins exposed with no guidance to anchor expectations.
What we're watching
- Whether domestic contracts reset to higher market prices after June.
- Actual commissioning of the delayed fiber draw capacity.
- Q1 FY27 margin trends amid cited supply-chain disruptions.
The full read
Finolex Cables' call confirmed a key timeline has slipped. The optical fiber draw capacity expansion is now targeted for end-Q2 FY27, not earlier. That pushes back the benefit from rising global fiber prices, because domestic contracts are fixed through June. Until they roll over, Finolex is selling fiber at older, lower prices. Management guided ₹300 crore in capex for the year but won't quantify margin pressure from supply-chain disruptions. The one bright spot is the EHV joint venture, which notched its first profitable year with ₹21 crore PBT on ₹450 crore revenue. The core issue is timing. The fiber pricing upside is intact, but it's now a story for the back half of FY27, and it depends on two things happening on schedule.
Questions answered
- Why does the fiber capacity delay matter?
- Global fiber prices are rising, but Finolex cannot benefit until the new capacity is operational and existing fixed-price domestic contracts expire. The delay pushes both the revenue and capex payoff by at least two quarters.
- How long are domestic contracts fixed for?
- The contracts are locked through June 2026. After that point, the company can reset pricing to reflect current global fiber costs, assuming the new capacity is online.
- What was the EHV joint venture's performance?
- The EHV JV reported its first profitable year with ₹21 crore PBT on ₹450 crore revenue. It is a positive but small contributor relative to the delayed fiber upside.
- Why isn't management giving margin guidance?
- Management cited near-term margin caution due to supply-chain disruptions but did not quantify the impact. They provided the ₹300 crore capex figure but declined to commit to margin outcomes.
Story so far
All notes on FINCABLES →- 29 May 2026 · 7:07 PM IST Finolex Cables pushes fiber expansion to Q2 FY27, defers pricing upside
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