HFCLNSEHFCL Limited· Telecommunication - EquipmentHighPositive
Announced Wed, 25 Mar · 17:59 IST

HFCL Limited has informed the Exchange about Capacity addition - Establishment of Preform Manufacturing Facility The Board of Directors at its meeting held today, has, inter-alia, approved the setting up of a Preform Manufacturing Facility through the Company s wholly owned subsidiary, HFCL Technologies Private Limited ( HTPL ). This initiatives forms part of HFCL s strategy to achieve higher level of backward integration within its Optical Fiber Cable (OFC) business with Preform being basic Raw Material for the manufacture of Optical Fiber.

Major Capex Above 10pct NetworthGreenfield CommissionedCapex & Operations View source PDF

HFCL · price

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Price reaction · full curve 14 horizons · vs prior close
-4.2%1-day move
₹70.79
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₹71.50
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AI summary

HFCL's board has approved setting up a new Preform Manufacturing Facility through its wholly owned subsidiary, HFCL Technologies Private Limited (HTPL). The facility will add around 300-310 Metric Tonnes per annum of Preform capacity — Preform being the basic raw material for optical fiber — with an estimated investment of about ₹580 crore, expected to be completed by July 2029. The move is aimed at backward integration into HFCL's Optical Fiber Cable (OFC) business to secure raw material supply, cut import dependence, and boost margins. HFCL has already doubled its optical fiber capacity from 14 mn fkm to 28 mn fkm, with a target of 33.90 mn fkm. Funding will come from internal accruals, debt, a proposed preferential issue, or a combination of these.

Likely market impact

This ₹580 crore capex signals management's confidence in long-term OFC demand and should strengthen margins once operational, but the size of the outlay and the possibility of equity dilution through a preferential issue may weigh on short-term investor sentiment.