Finolex Cables lifts margin sharply and draws an outsized market reaction
Revenue growth outpaced costs, while a lower sequential tax rate also supported profit; other income contributed 29.35% of pre-tax profit.
Filed 11 Aug 2026, 14:22 IST · Finolex Cables Ltd (FINCABLES)
Key takeaways
- Consolidated net profit rose 53.14% YoY as revenue growth of 44.26% outpaced expense growth of 40.49%.
- Operating margin expanded 2.36 percentage points YoY to 12.13%, reversing the 9.25% margin recorded in Q4FY26.
- The stock gained 14.79% on the results day, far above its 2.49% median move after the previous eight results.
Price around the results
Revenue momentum improved while profit growth accelerated
Finolex Cables reported consolidated revenue growth of 44.26% YoY and 3.18% QoQ, with net profit increasing 53.14% YoY and 10.97% QoQ. The sequential improvement came despite other income falling 34.10%, as operating profit rose 35.32% and expenses declined 0.09%. The company remains below the Industrials median operating margin of 13.93% across 112 reported peers, by 1.80 percentage points.
Cost control drove the margin rebound
Expenses grew 40.49% YoY against 44.26% revenue growth, lifting operating margin by 2.36 percentage points; sequentially, expenses fell 0.09% while revenue rose 3.18%, widening margin by 2.88 percentage points. This is a clear rebound from the 9.25% margin in Q4FY26, after margins moved from 10.55% in Q2FY26 to 9.86% in Q3FY26 and 9.25% in Q4FY26. Other income accounted for 29.35% of pre-tax profit, so reported earnings included a material non-operating contribution.
Lower sequential tax rate added to net profit growth
The sequential tax rate fell 5.22 percentage points to 20.80%, helping net profit rise 10.97% even as pre-tax profit increased only 3.65%. Year on year, the tax rate rose 1.09 percentage points, so the 53.14% net-profit increase was primarily supported by operating profit growth rather than a tax-rate benefit. Interest remained small, with a 2.27% QoQ increase and a 7.14% YoY increase.
The market reaction was unusual for this stock
The shares gained 14.79% on the results day, compared with a median absolute move of 2.49% after the previous eight results. The stock had risen after two of those results and fallen after six, making this reaction notably stronger and directionally different from its recent pattern.
Q1FY27 at a glance
Consolidated figures as filed with NSE — cross-checked against an independent source.
| Line item | Q1FY27 | Q4FY26 | QoQ | YoY |
|---|---|---|---|---|
| Revenue | ₹2,013 cr | ₹1,951 cr | +3.18% | +44.26% |
| Other income | ₹92 cr | ₹140 cr | -34.10% | +14.93% |
| Expenses | ₹1,769 cr | ₹1,771 cr | -0.09% | +40.49% |
| Operating profit | ₹244 cr | ₹180 cr | +35.32% | +79.04% |
| Operating margin (%) | 12.13% | 9.25% | — | — |
| Interest | ₹0 cr | ₹0 cr | +2.27% | +7.14% |
| Depreciation | ₹22 cr | ₹17 cr | +29.33% | +57.26% |
| Profit before tax | ₹314 cr | ₹303 cr | +3.65% | +55.25% |
| Tax | ₹65 cr | ₹79 cr | -17.14% | +63.84% |
| Net profit | ₹249 cr | ₹224 cr | +10.97% | +53.14% |
| EPS (₹) | ₹16.28 | ₹14.67 | +10.97% | +53.15% |
Operating margin of 12.13% compares with a Industrials sector median of 13.93% across 112 peers that have reported Q1FY27.
How the stock reacted
| Window | Stock | vs NIFTY |
|---|---|---|
| Results day | +14.79% | +15.24% |
Volume on the results session was 36.36× its 20-day average.
What to watch
- Whether operating margin holds above 12.13% after the sequential rebound.
- Whether expense growth remains below revenue growth of 44.26% YoY.
- Whether other income stays below or exceeds its 29.35% share of pre-tax profit.