X

Sign up for Equitymaster's free daily newsletter, The 5 Minute WrapUp and get access to our latest Multibagger guide (2017 Edition) on picking money-making stocks.

This is an entirely free service. No payments are to be made.


Download Now Subscribe to our free daily e-letter, The 5 Minute WrapUp and get this complimentary report.
We hate spam as much as you do. Check out our Privacy Policy and Terms Of Use.
"Having mastered this technology, Finolex has been exporting JFTC and in the last two years having recorded a growth of more than 200% in exports." - Views on News from Equitymaster
 
 
  • PRINT
  • E-MAIL
  • A  A  A
  • Mar 9, 2001

    "Having mastered this technology, Finolex has been exporting JFTC and in the last two years having recorded a growth of more than 200% in exports."

    Mr. Deepak Chhabria is the Managing Director of Finolex Cables Ltd. and is actively involved in the sister concerns Finolex Wire Products Ltd. and Finolex Technologies Ltd. Mr. Chhabria is an engineering graduate from University of Evansville, USA and has been in the cable industry for the past 16 years.

    In an interview with equitymaster.com, Mr. Chhabria spoke extensively on the cable industry and gave indications of the road ahead for Finolex Industries Ltd.

    EQM:   Briefly, comment on the existing industry scenario and how you see it evolving over the next 3 years?

    Mr. Chhabria:  The industry growth has been mixed and different in various sectors. Specifically in the cable industry there has been strong growth in the telecommunications and housing sector. The growth has been stagnant in the power cable sector. Further, due to intense competition, margins in the power cable segment have also come under pressure for the past many years. The overall cable industry is poised to see good growth for the next three years backed by strong demand in the telecommunications, housing and agricultural sector.

    EQM:  Please describe the functionality of the various types of cables produced by Finolex Cables Ltd.?

    Mr. Chhabria:  Finolex Cables Ltd. (FCL) manufactures a variety of cables and is the only company in India that offers such a wide range. Our aim is to provide a 'Total Cable Solution' to the consumer. We provide electrical wires for lighting homes, multicore flexible cables for appliances as well as panel wiring, auto and battery cables for automobiles, coaxial cables for cable television, switch board cables for the internal wiring of telephone exchanges, LAN cables for computer networking, variety of telecommunication cables for telecom services providers, winding wires for submersible pumps, 3 core flat cables for the agricultural sector and low voltage power cables for use in power distribution and by the industry.

    EQM:  A dominant part of Finolex Cable sales are from jelly filled telecom cables (JFTC), which contribute more than 50% to the sales. However, there is a decline in JFTC demand as service providers shift to OFC. How does the company plan to cope in such an environment?

    Mr. Chhabria:  There is strong growth taking place in the optic fibre cable segment. Optic fibre is mainly used for backbone networks and in areas where high bandwidth is required. Finolex Cables is producing fibre optic cables in our group company, Finolex Technologies Ltd. (FTL).

    Even with the boom taking place in fibre there is no decline in demand for jelly filled telecom cables (JFTC). In fact, every year Bharat Sanchar Nigam Ltd. (BSNL) (erstwhile DoT) has been purchasing JFTC at a growth of approximately 20%. There is expectation of a 20% growth in next year's tender to be floated by BSNL as well. The cost per line in copper cables is very cheap as compared to fibre optic cables in the distribution segment as well as when the network is being spread to the rural areas. Hence, as the network keeps expanding there is continuous demand for additional capacity in JFTC. Finolex Cables Ltd. has simultaneously expanded its JFTC capacity by setting up a plant in Goa, which was commissioned in December 1999. By shifting to Goa, the company will be able to benefit from zero sales tax and advantages in income tax.

    EQM:  With telecom services getting deregulated worldwide, what opportunities does it throw up for the telecom infrastructure export market? What is the potential of supplying cables to other developing countries?

    Mr. Chhabria:  Finolex Cables has been manufacturing solid insulation as well as foam skin cables for many years. Worldwide the demand for copper telephone cables has been in foam skin cables and even today the African continent specifications demand foam skin cables, which provide better electricals and lower cost. Having mastered this technology, Finolex has been exporting JFTC and in the last two years having recorded a growth of more than 200% in exports.

    EQM:  The company has diversified into the manufacturing of continuous cast copper rods. What is the capacity of this plant? How much of the copper is consumed in-house? Are there any plans of setting up a smelter?

    Mr. Chhabria:  The company has set up a 100% subsidiary 'Finolex Wire Products Ltd.' (FWPL), which manufactures continuous cast copper rods. The plant is situated in Goa with a capacity of 60,000 tonnes per annum (TPA). At present 40% of the plant's production is consumed by Finolex Cables and the balance is sold to outside customers. With our plans for growth, we plan to soon use majority of the consumption captively. There are no plans for setting up a smelter. We backward integrated into copper rods to maintain quality of our main raw material. Due to a variety of cables produced by us, our process needs require that we control the quality of copper in close tolerances.

    EQM:  What initiatives is Finolex Cables Ltd. taking to enhance shareholder value?

    Mr. Chhabria:  Finolex Cables plans are to continuously provide a one-stop cabling solution to any customer. With this, we are focusing step by step to provide total solutions along with our cables. E.g. we are importing connectors and passive components from Leviton, USA and are offering our LAN cables fully tested and integrated with the passive components so that the customer can buy a system, which is guaranteed by us. In such a manner we intend to be close to the customer, improve the company's performance as well as enhance shareholder's value.

    EQM:  Is there any person or book that has influenced you deeply?

    Mr. Chhabria:  Our chairman, Shri P.P. Chhabria and my father, Shri K.P. Chhabria have continuously guided and shared their valuable experience with me, such that I believe today for our country to catch up with the developed countries, we have to work harder and longer to bridge the gap. Thinking smart is of course a necessity but we should not underestimate competition and working harder will bridge the gap faster.

     

     

    Equitymaster requests your view! Post a comment on ""Having mastered this technology, Finolex has been exporting JFTC and in the last two years having recorded a growth of more than 200% in exports."". Click here!

      
     

    More Views on News

    Sorry! There are no related views on news for this company/sector.

    Most Popular

    This Small Cap Can Drive Chinese Players Out of India (and Make a Fortune in the Process)(The 5 Minute Wrapup)

    Aug 17, 2017

    A small-cap Indian company with high-return potential and blue-chip-like stability is set to supplant the Chinese players in this niche segment.

    Dear PM Modi, India is Already Land of Self-Employed, and It Ain't Working(Vivek Kaul's Diary)

    Aug 21, 2017

    Most Indians who cannot find jobs, look at becoming self-employed.

    It's the Best Time to Buy IT Stocks(Daily Profit Hunter)

    Aug 16, 2017

    The IT Sector could be in an uptrend till February 2019. Are you prepared to ride the trend?

    5 Steps To Become Financially Independent(Outside View)

    Aug 16, 2017

    Ensure your financial Independence, and pledge to start the journey towards financial freedom today!

    Think Twice Before You Keep Money In A Savings Bank Account(Outside View)

    Aug 22, 2017

    Post demonetisation, a cut in bank savings deposits rates was in the offing.

    More
    Copyright © Equitymaster Agora Research Private Limited. All rights reserved.
    Any act of copying, reproducing or distributing this newsletter whether wholly or in part, for any purpose without the permission of Equitymaster is strictly prohibited and shall be deemed to be copyright infringement.

    LEGAL DISCLAIMER: Equitymaster Agora Research Private Limited (hereinafter referred as 'Equitymaster') is an independent equity research Company. Equitymaster is not an Investment Adviser. Information herein should be regarded as a resource only and should be used at one's own risk. This is not an offer to sell or solicitation to buy any securities and Equitymaster will not be liable for any losses incurred or investment(s) made or decisions taken/or not taken based on the information provided herein. Information contained herein does not constitute investment advice or a personal recommendation or take into account the particular investment objectives, financial situations, or needs of individual subscribers. Before acting on any recommendation, subscribers should consider whether it is suitable for their particular circumstances and, if necessary, seek an independent professional advice. This is not directed for access or use by anyone in a country, especially, USA or Canada, where such use or access is unlawful or which may subject Equitymaster or its affiliates to any registration or licensing requirement. All content and information is provided on an 'As Is' basis by Equitymaster. Information herein is believed to be reliable but Equitymaster does not warrant its completeness or accuracy and expressly disclaims all warranties and conditions of any kind, whether express or implied. Equitymaster may hold shares in the company/ies discussed herein. As a condition to accessing Equitymaster content and website, you agree to our Terms and Conditions of Use, available here. The performance data quoted represents past performance and does not guarantee future results.

    SEBI (Research Analysts) Regulations 2014, Registration No. INH000000537.

    Equitymaster Agora Research Private Limited. 103, Regent Chambers, Above Status Restaurant, Nariman Point, Mumbai - 400 021. India.
    Telephone: +91-22-61434055. Fax: +91-22-22028550. Email: info@equitymaster.com. Website: www.equitymaster.com. CIN:U74999MH2007PTC175407
     

    Become A Smarter Investor In
    Just 5 Minutes

    Multibagger Stocks Guide 2017
    Get our special report, Multibagger Stocks Guide (2017 Edition) Now!
    We will never sell or rent your email id.
    Please read our Terms

    FINOLEX CABLES SHARE PRICE


    Aug 24, 2017 10:51 AM

    TRACK FINOLEX CABLES

    • Track your investment in FINOLEX CABLES with Equitymaster's Portfolio Tracker. Set live price alerts, get research alerts and more. Get access now...
    • Add To MyStocks

    MORE ON FINOLEX CABLES

    FINOLEX CABLES 8-QTR ANALYSIS

    Detailed Quarterly Results With Charts

    COMPARE FINOLEX CABLES WITH

    MARKET STATS