It has been challenging for investors over the past year in the Indian stock market, as most trading sessions were characterized by market pressure, and many depositors did not achieve significant profits on their portfolios. However, among this complex market, there were shares that showed a completely different dynamic. Finolex Cables is among these selective stocks, showing growth of about 74% by 2026. Furthermore, this stock recently reached its fifty-two-week high.
Share growth was about 29% in one month
The recent rise in Finolex Cables shares has attracted market attention. On September 9, the stock reached a new fifty-two-week high. The day before, on September 8, it showed a growth of approximately 6%. The growth continued on September 10: by noon, the stock was trading at ₹1,409.50 with an increase of 4.15%. Over the last month, Finolex shares have grown by approximately 29%. Thus, despite the weakness of the market, this stock has not only demonstrated strong growth this year but has also brought good returns to investors in recent weeks.
Brokerage firm Jefferies assigned a 'Buy' rating
Against the backdrop of share growth, the brokerage firm Jefferies maintained its 'Buy' rating for Finolex Cables. The broker set a target price for the stock at ₹1,410. The stock reached a level of about ₹1,409.50 by noon on September 10, thereby confirming Jefferies' rating. According to the broker, despite strong growth this year, the company's price-to-earnings (P/E) ratio is about 21 times. Jefferies believes that this figure is lower than that of its competitors, indicating potential for growth from a valuation perspective.
6 out of 7 analysts recommended buying
Out of seven analysts covering Finolex Cables, six gave a buy recommendation, while only one advised selling. This indicates that despite the significant growth already achieved by the stock, most analysts remain hopeful for further growth of the company. Nevertheless, analyst opinions do not guarantee investment in any stock; investment decisions should be made considering the company's business, valuation, risks, and one's own financial situation.
Margin support through communication cables
According to Jefferies, the communication cable business plays a significant role in improving the company's margin. The share of communication cables in the entire optical fiber cable business is about 75%. This business is also considered an important element in the future growth story of the company. The company is also working to expand its fiber capabilities. It is planned that by December 2026, the company will double its fiber production capacity to 80 lakh kilometers. Assuming a fiber price of $11 per kilometer, the capacity increase could bring the company an additional ₹200–250 crore in quarterly revenue after the capacity expansion. Forecasts suggest this could account for about 11% of the company's total sales in the 2028 fiscal year. Thus, the company's capacity expansion plan could play an important role in increasing its business and sales in the future.
Electrical remains the largest segment
The share of the electrical business in Finolex Cables' total sales is about 85%, which is the main area of the company's operations. In addition, the company is also focusing on new areas such as solar energy and Extra High Voltage (EHV) equipment. These new areas are expected to provide additional support to the company's future growth.
Is there still room for stock growth?
Finolex Cables has shown growth of about 74% by 2026 and recently reached a fifty-two-week high. Despite this, the 'Buy' rating from Jefferies and the positive opinions of most analysts indicate that part of the market believes in the company's further growth. Now, what is most important for the company is how quickly it implements its fiber capacity expansion plan. Investors will also monitor the sustainability of margin improvement through the communication cable business and the growth rate of new areas such as solar energy and EHV.