HFCL Plans 470 Cr Expansion to Triple Optical Fibre Cables Capacity of Hyderabad Plant
Himachal Futuristic Communications Limited (HFCL), a Delhi-headquartered manufacturer of Optical Fibre cables, has announced capacity expansion of its optical fiber manufacturing facility in Hyderabad. This capacity expansion will entail a cost of INR 470 Crore.
HFCL to Triple its Manufacturing Capacity by End of 2024
HFCL in its stock filing dated 31st May 2023 stated that it will increase the current capacity of its Hyderabad plant from 10 mn fkm/p.a. (million fiber Km per annum) to 33.90 mn fkm/p.a. HFCL will finance the aforementioned expansion through debt and internal accruals. The company has set the target to complete the expansion in a phased manner by December 2024.
The current HFCL plant at Hyderabad was commissioned in January 2020 with an investment of Rs. 260 crore at the time. Later, a new automated high-speed FTTH line was added with an investment of Rs. 40 crore.
HFCL to Serve Domestic 5G Demand and Growing Export Needs with Capacity Expansion
HFCL’s expansion at its Hyderabad facility will help the company better serve increasing demand due to the rollout of 5G networks across India. The company is also expecting double-digit growth in export demand of telecom equipment which will ultimately contribute to optical fibre demand.
HFCL in its filing stated that this expansion will help to strengthen its supply chain and also improve overall margins of the company.
Robust Order Book of INR 7K Crore to Support HFCL’s Expansion Plans
HFCL in its press release dated 8th May 2023 stated that it had an order book worth more than Rs. 7,000 crore as on date. Major orders contributing to HFCL’s order book include an order worth Rs. 206.67 crore from Reliance Projects and Property Management Services Limited and Reliance Retail Limited to supply Optical Fibre Cables received in January 2023.
In March 2023, HFCL had won an order from Gujarat Metro Rail Corporation Limited (GMRCL) of Rs. 282.61 crore for installing telecommunication systems at Surat Metro Rail Project. In a stock filing dated 22nd May 2023, HFCL stated that it had won optical fibre orders worth Rs. 221.95 crore from Reliance Group.
Apart from these HFCL received an advance purchase order booking of INR 448 Crore from Railtel and BSNL in September 2022 which is expected to be completed by Q1 of FY-24.
About HFCL: HFCL was founded in 1987, and has its headquarters in Delhi. It caters primarily to the communication sector through optical fibre cables and transmission & access equipment manufacturing. HFCL has optical fibre cables manufacturing facilities in Goa and Hyderabad. HTL Limited, the company’s subsidiary, also has an optical fibre cables manufacturing plant in Chennai. The company has a Cable Reinforcement Solutions Plant in Hosur, Tamil Nadu.