Polycab India Faces Rs 327 Crore Tax Demand, Stock Dips 3%
Synopsis
Polycab India Limited's shares fell 3% following a Rs 327.45 crore income tax demand for the 2024-25 assessment year. Despite this, the company reported strong quarterly earnings, with revenue and EBITDA witnessing substantial growth.
Key Takeaways
Polycab India Limited faces a tax demand of Rs 327.45 crore .
Shares declined by 3.20% post-announcement.
Company reported a 46.1% revenue growth for the December quarter.
EBITDA rose 34.2% year-on-year to Rs 966.7 crore .
Polycab is filing an appeal against the tax demand.
Mumbai, March 4 (NationPress) Shares of Polycab India Limited experienced a decline on Wednesday after the firm disclosed it had received an income tax demand of Rs 327.45 crore for the assessment year 2024-25. The notice was issued by the Office of the Deputy Commissioner of Income Tax, Mumbai, and was acknowledged by the company on March 3, 2026.
The demand stems from an assessment order that includes disallowances and additions totaling Rs 41.87 crore.
Nevertheless, Polycab stated that upon consulting its tax advisors, it believes that the total demand is inflated compared to the additions cited in the order due to potential computational or clerical errors.
The company emphasized that these discrepancies can be rectified under the provisions of the Income Tax Act and has initiated the process of submitting a rectification application with the relevant Assessing Officer.
Furthermore, Polycab considers the tax demand to be legally indefensible and is preparing to lodge an appeal against the additions under the Income Tax Act, 1961.
The company reassured stakeholders that it does not anticipate any significant impact on its financial performance or operations due to this order.
In spite of the tax situation, the company reported robust quarterly earnings, with its revenue for the December quarter surging by 46.1 percent year-on-year to Rs 7,636.1 crore.
EBITDA climbed 34.2 percent to Rs 966.7 crore from Rs 720 crore a year prior.
However, the EBITDA margin contracted to 12.66 percent from 13.8 percent last year.
The company’s advertising and sales promotion expenses more than doubled, reaching Rs 91 crore compared to Rs 37.3 crore in the same quarter last year.
Finance costs also increased to nearly Rs 69 crore from Rs 50 crore the previous year, as noted in its prior stock exchange filing.
Breaking down the segments, revenue from the core wires and cables business soared to Rs 6,852 crore, up from Rs 4,450 crore last year.
The fast-moving electrical goods (FMEG) segment saw revenue rise to approximately Rs 500 crore from Rs 423.1 crore, while the EPC segment reported revenue of Rs 407 crore compared to Rs 392 crore in the corresponding period last year.
In light of these developments, shares of Polycab India Limited closed at Rs 8,274.50 on the BSE, down Rs 273.90, or 3.20 percent.
Point of View
It is crucial to highlight that Polycab India's recent income tax demand raises concerns among investors, yet the company's robust financial results indicate resilience. The market's reaction underscores the need for transparency and clarity in financial dealings.
NationPress
1 Jul 2026
Frequently Asked Questions
What is the income tax demand amount Polycab received?
Polycab India Limited received an income tax demand of Rs 327.45 crore for the assessment year 2024-25.
How did the tax demand impact Polycab's share price?
Following the announcement of the tax demand, shares of Polycab India Limited fell by 3.20%.
What are Polycab's recent financial performance highlights?
In the December quarter, Polycab reported a 46.1% year-on-year revenue increase to Rs 7,636.1 crore and a 34.2% rise in EBITDA to Rs 966.7 crore.
What actions is Polycab taking regarding the tax demand?
Polycab believes the demand is inflated and is filing a rectification application, as well as preparing to appeal under the Income Tax Act, 1961.
Will the tax demand significantly affect Polycab's operations?
Polycab has stated that it does not expect any material impact on its financial position or operations due to the tax demand.
