(“When your margins are thin but your P/E is triple digits”)
1. At a Glance
Once a humble cable manufacturer from Rewa, Birla Cable is now selling dreams in optical fibre form — while EU duties, falling profits, and 105x P/E ratios politely gnaw in the background.
2. Introduction with Hook
Imagine running a marathon… wearing flip-flops… on a slope… with a backpack full of EU anti-dumping duties.
That’s Birla Cable Ltd in FY25.
- ROE? Just 2%.
- P/E? An elegant 105.
Welcome to the optical illusion of India’s slowest-moving telecom equipment stock.
3. Business Model (WTF Do They Even Do?)
Birla Cable Ltd (BCL), part of the M.P. Birla group, manufactures:
- Optical Fibre Cables (OFCs)
- Copper Telecom Cables
- Structured Cables
- Specialty Cables (for you, not-so-special margins)
Customers include:
- Telecom Companies (domestic + exports)
- Defence, Railways, Utilities
- OEMs needing data cables, power cables, and all the spaghetti in between.
Recently:
- Capacity expansion for 10,000 boxes of data cables
- Exports hit by 8.3% EU duty (ouch)
- Litigations and GST notices just for added spice.
4. Financials Overview
| Metric | FY25 | FY24 | FY23 |
|---|---|---|---|
| Revenue (₹ Cr) | 662 | 686 | 792 |
| Net Profit (₹ Cr) | 5 | 22 | 33 |
| EPS | ₹1.68 | ₹7.5 | ₹11.16 |
| OPM | 5% | 6% | 8% |
| ROE | 1.99% | 7.5% | 11.16% |
| ROCE | 5.15% | 10% | 18% |
Plot twist: Sales falling, margins compressing, and profits have faceplanted harder than a B-grade IPO.
5. Valuation
Let’s address the elephant (with optical cables tied to it): the P/E is 105.
For a company growing TTM profits at -70% and running 5% OPM, that P/E is… a vibe, not a valuation.
EduFair Value Range (2025–26):
- Pessimistic (10x normalized EPS ₹2): ₹20
- Optimistic (20x EPS ₹5): ₹100
- Wild IPO-style hope (50x future ₹4): ₹200
FV Range: ₹20 – ₹100 (unless fundamentals start doing CrossFit)
6. What’s Cooking – News, Triggers, Drama
- EU Duty Disaster: 8.3% anti-dumping duty on OFC exports
- GST Penalty: ~₹5.94 Cr + penalty
- Vindhya Guarantee: Corporate guarantee of ₹600 Cr.
- CapEx Hope: Data cable capacity + greenfield optimism
- Acquisition: Shares bought in Continuum MP Windfarm (diversify or di-worsify?)
- Litigation: Priyamvada Devi Birla estate fight — ongoing and spicy
7. Balance Sheet
| Particulars | FY25 | FY24 | FY23 |
|---|---|---|---|
| Equity | ₹30 Cr | ₹30 Cr | ₹30 Cr |
| Reserves | ₹224 Cr | ₹222 Cr | ₹200 Cr |
| Borrowings | ₹111 Cr | ₹165 Cr | ₹129 Cr |
| Total Liabilities | ₹417 Cr | ₹459 Cr | ₹461 Cr |
| Fixed Assets | ₹128 Cr | ₹117 Cr | ₹83 Cr |
| Investments | ₹42 Cr | ₹37 Cr | ₹30 Cr |
| Other Assets | ₹247 Cr | ₹304 Cr | ₹345 Cr |
Key Points:
- Borrowings down, but still chunky
- Asset-heavy, returns light
- ₹600 Cr contingent liability — not showing up but lurking
8. Cash Flow – Sab Number Game Hai
| FY | CFO (₹ Cr) | CFI | CFF | Net |
|---|---|---|---|---|
| 2025 | ₹112 | -₹38 | -₹74 | ₹1 |
| 2024 | ₹16 | -₹32 | ₹15 | -₹0 |
| 2023 | -₹7 | -₹24 | ₹30 | -₹0 |
Key Points:
- Operating cash flow finally solid in FY25
- Consistent investment outflows
- Financing: repayments rising — maybe getting serious about debt?
9. Ratios – Sexy or Stressy?
| Ratio | FY25 | FY24 | FY23 |
|---|---|---|---|
| ROE | 2% | 7.5% | 11.16% |
| ROCE | 5.15% | 10% | 18% |
| OPM | 5% | 6% | 8% |
| Debt/Equity | 0.37 | 0.55 | 0.65 |
| Inventory Days | 35 | 51 | 60 |
| Debtor Days | 92 | 114 | 100 |
Verdict:
Margins are thinner than Nokia 1100’s display.
Efficiency is improving. But so are competitors. Meh.
10. P&L Breakdown – Show Me the Money
| ₹ Cr | FY25 | FY24 | FY23 |
|---|---|---|---|
| Revenue | 662 | 686 | 792 |
| EBITDA | 33 | 41 | 64 |
| Interest | 13 | 15 | 13 |
| Depreciation | 16 | 11 | 11 |
| PBT | 7 | 30 | 45 |
| Net Profit | 5 | 22 | 33 |
Trend:
Falling topline. Shrinking bottom line. Barely breathing EBITDA.
If this were a movie, it’d be called “Cable… but No Signal.”
11. Peer Comparison
| Company | CMP | P/E | OPM | ROE | MCap (Cr) |
|---|---|---|---|---|---|
| Tejas Networks | ₹693 | 27.4 | 14% | 12.77% | ₹12,251 |
| ADC India | ₹1258 | 23.6 | 15.6% | 34.7% | ₹579 |
| Optiemus | ₹600 | 82.7 | 5.7% | 11.6% | ₹5,237 |
| Valiant Comm. | ₹882 | 70 | 9.6% | 16.95% | ₹673 |
| Birla Cable | ₹177 | 105.4 | 5% | 1.99% | ₹530 |
Peer Verdict:
You’re the most expensive by P/E, with the lowest ROE.
That’s not premium — that’s delusion.
12. Miscellaneous – Shareholding, Promoters
| Category | Mar ’25 |
|---|---|
| Promoters | 66.35% |
| FIIs | 0.13% |
| DIIs | 0.01% |
| Public | 33.52% |
| No. of Shareholders | 50,723 |
- Solid promoter stake
- No serious institutional interest
- Public optimism = the real bullish driver
13. EduInvesting Verdict™
Birla Cable is a company where the cables are fibre but the fundamentals are… frail.
- Weak ROE/ROCE
- Expensive valuations
- Sales under pressure
- GST & EU tariff drama
- Still, loyal promoter group and a ₹600 Cr safety net via Vindhya
EduTake: This stock is what happens when a mid-90s cable network dreams of becoming a Netflix original.
We’ll watch the turnaround arc — if it ever gets written.
Metadata
– Written by EduInvesting Research | July 12, 2025
– Tags: Telecom, Optical Fibre, Smallcap, Birla Group, Cable Stocks, Deep Dive, Earnings Analysis, GST, EU Duty, Turnaround Stocks, Low ROE
