HFCL Q2 FY25 Results, Secures Strategic Defense Partnership

HFCL has announced its unaudited financial results for the second quarter and half-year ending September 30, 2024. HFCL operates in manufacturing high-end telecom equipment, optical fiber, and optical fiber cables, and provides communication network solutions for telecommunications, defense, and railway sectors.

Financial Highlights - Q2FY25

1. HFCL reported consolidated revenue of ₹1094 crores in Q2FY25, a slight decline of 5.58% compared to ₹1158 crores in Q1FY25 and a decrease of 1.61% compared to ₹1111 crores in Q2FY24. The decrease was attributed to global demand softness for optic fiber cables and weather-related delays in work execution.
2. The company posted an EBIDTA of ₹172 crores, which represents a decrease of 7.31% from ₹185 crores in Q1FY25. However, on a year-on-year basis, HFCL saw a 14.72% increase compared to ₹150 crores in Q2FY24. The margin stood at 15.71% in Q2FY25, down 29 basis points (Bps) from 16.00% in Q1FY25, but an improvement of 224Bps from 13.47% in Q2FY24.
3. HFCL reported a PAT of ₹73 crores in Q2FY25, a decrease of 33.73% from ₹111 crores in Q1FY25. Nonetheless, this still reflects a 4.50% year-on-year growth from ₹70 crores in Q2FY24. The PAT margin stood at 6.71% in Q2FY25, down by 284Bps from Q1FY25 but an improvement of 40Bps from 6.31% in Q2FY24.

On a standalone basis, HFCL reported quarterly revenue of ₹1012 crores, with EBIDTA at ₹161 crores. The company’s Profit Before Tax (PBT) stood at ₹104 crores, and Profit After Tax (PAT) amounted to ₹75 crores.

During the quarter, HFCL achieved several key milestones. The company successfully delivered one of the world’s largest advanced broadband network gateway projects for BSNL, enhancing its reputation in telecom solutions. In addition, HFCL entered into a strategic partnership with General Atomics Aeronautical Systems Incorporated (GA-ASI) from the US to develop critical sub-systems for sophisticated unmanned aerial vehicles (UAVs). This partnership marks a significant step in HFCL’s defense sector expansion and is expected to create new export opportunities. The company is also in advanced discussions for the export of its indigenously designed and developed Electronics Fuzes, which could further boost international revenue.

In summary, HFCL has maintained steady performance despite market headwinds, while its strategic initiatives, particularly in the defense sector and export markets, signal strong growth potential for the future.