Fundamental Overview
*Business: HFCL manufactures optical fibre cables, telecom infra solutions, and 5G equipment. It is also expanding into defence manufacturing with 1,000 acres allotted in Andhra Pradesh.
*FY25 Results: Revenue slipped to ~₹4,064 Cr (down from ₹4,465 Cr in FY24), while net profit nearly halved to ~₹177 Cr. Q4FY25 posted a net loss (~₹81 Cr) due to weak OFC demand.
*Valuation: Currently trades at a P/E > 300x, indicating very high growth expectations are priced in.
*Balance Sheet:Debt-to-equity is comfortable at 0.28, liquidity healthy (current ratio ~1.87x).
*Guidance: Management expects 25–30% revenue growth in FY26, driven by strong order book and 5G product demand.
*Strengths: Exposure to 5G & defence, strong order book, low leverage.
*Risks: High valuation, weak recent earnings, promoter pledge (~54%), long receivable cycles.
Technical Setup
Pattern: Weekly chart shows a falling wedge, typically a bullish reversal pattern.
Reversal Zone: Price bounced from the ₹72–75 support band.
Key Level: A weekly close above ₹78 signals breakout strength.
Targets:
*Business: HFCL manufactures optical fibre cables, telecom infra solutions, and 5G equipment. It is also expanding into defence manufacturing with 1,000 acres allotted in Andhra Pradesh.
*FY25 Results: Revenue slipped to ~₹4,064 Cr (down from ₹4,465 Cr in FY24), while net profit nearly halved to ~₹177 Cr. Q4FY25 posted a net loss (~₹81 Cr) due to weak OFC demand.
*Valuation: Currently trades at a P/E > 300x, indicating very high growth expectations are priced in.
*Balance Sheet:Debt-to-equity is comfortable at 0.28, liquidity healthy (current ratio ~1.87x).
*Guidance: Management expects 25–30% revenue growth in FY26, driven by strong order book and 5G product demand.
*Strengths: Exposure to 5G & defence, strong order book, low leverage.
*Risks: High valuation, weak recent earnings, promoter pledge (~54%), long receivable cycles.
Technical Setup
Pattern: Weekly chart shows a falling wedge, typically a bullish reversal pattern.
Reversal Zone: Price bounced from the ₹72–75 support band.
Key Level: A weekly close above ₹78 signals breakout strength.
Targets:
- R1: ₹87
- R2: ₹100
- R3: ₹116
- R4: ₹130
Stop-Loss Zone: Below ₹72 (reversal zone invalidation).
Trading Idea
Swing Trade Setup: - Entry: Close above ₹78 with volume confirmation.
- Targets: ₹87 / ₹100 / ₹116 / ₹130.
- Stop-Loss: Below ₹72.
Investor View: Fundamentals are a mix of long-term growth drivers (5G, defence) and short-term earnings pressure. Best suited for accumulation near support zones, rather than chasing overvalued levels.
Conclusion
HFCL is at an inflection point. The fundamentals show sector tailwinds (5G + defence), but valuations and profitability remain a concern. Technically, a breakout above ₹78 from the falling wedge could align with management’s bullish FY26 guidance, opening the path toward ₹100+ in coming months.
Disclaimer:lnkd.in/gJJDnvn2
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Aviso legal
As informações e publicações não devem ser e não constituem conselhos ou recomendações financeiras, de investimento, de negociação ou de qualquer outro tipo, fornecidas ou endossadas pela TradingView. Leia mais em Termos de uso.