HFCL shares up over 100% in a month; these factors are aiding the upmove

Shares of HFCL Ltd. gained another 3% on Thursday, May 7, extending their sharp rally over the past month.

The stock has nearly doubled in the last one month and is currently on its fifth consecutive session of gains. HFCL has advanced 37% over the last five trading sessions and has closed higher in 17 of the previous 21 sessions.

Trading activity in the counter also remained elevated, with more than 10 crore shares exchanging hands for the fifth straight session.

Around 11 crore shares were traded on Thursday, significantly above the 20-day average volume of 6.3 crore shares, making it one of the most actively traded stocks on the Nifty 500 index.

The rally follows the company's strong March quarter earnings performance.

HFCL reported a net profit of ₹178.5 crore in Q4FY26, compared to a loss of ₹81.4 crore in the year-ago period. Revenue more than doubled year-on-year to ₹1,824 crore, while EBITDA turned positive to ₹315 crore from a loss last year, aided by strong execution and operating leverage.

Quarterly revenue increased 50.7% sequentially and 127.8% YoY, while EBITDA margins improved to nearly 18.5% on better scale and an improved product mix.

For FY26, the company reported a 21.8% rise in revenue to ₹4,949 crore, while EBITDA margins expanded to 16.7% from 12.5% a year earlier. Net profit for the year climbed 90% YoY to ₹329.4 crore.

HFCL has laid out an aggressive growth strategy, targeting revenue of over ₹10,000 crore by FY29 along with EBITDA margins of 20-21%.

The company expects exports to contribute more than 50% of revenue from FY27 onwards, compared to 41% currently. It is also aiming for product-led revenues to account for over 80% of total revenue by FY29.

Its order book remains robust at more than ₹21,200 crore, more than double the previous year’s level. The optical fibre and connectivity business continues to dominate the order pipeline, followed by EPC and defence.

HFCL recently secured a $1.1 billion global optical fibre cable supply contract, with execution expected to commence in Q1FY27.

Export contribution has risen sharply to 41% of FY26 revenue, up from 12% in FY25 and less than 5% in FY21, supported by a healthy international order pipeline.

The company is also focusing on improving margins through a larger contribution from optical fibre, telecom products, and defence manufacturing. Revenue share from private sector clients has increased to nearly 84%.

In defence, HFCL has visibility on orders worth nearly ₹2,230 crore, including export opportunities linked to its proposed aerospace acquisition.

The company has also received land allocation in Andhra Pradesh for a defence manufacturing facility, where groundwork is expected to begin later this month.

Separately, the board approved the issuance of up to 7.5 crore warrants to promoter group entities at ₹74 apiece to raise nearly ₹555 crore.

HFCL has also formed a strategic restructuring committee to explore potential business restructuring initiatives, including possible demergers or stake sales across its telecom, defence, and EPC businesses.