The shares of one of the leading telecom infrastructure manufacturers specializing in creating digital networks and various critical equipment for telcos, defence, enterprises, and governments jumped 4 percent in the day’s trade following collboration with General Atomics Aeronautical Systems Incorporated to supply critical subsystems for UAVs.
Price Action
With a market capitalization of Rs. 23,862 Crores, the shares of HFCL Limited were trading at Rs. 165.40 per equity share, up 2.26 percent from its previous day’s close price of Rs. 161.75
What Happened
HFCL Limited has announced a strategic partnership with General Atomics Aeronautical Systems Incorporated. HFCL Limited will develop and supply critical sub-systems for GA-ASI’s advanced Unmanned Aircraft Systems (UAS) through this strategic partnership and become a key contributor to one of the world’s most sophisticated unmanned aerial vehicles
The collaboration envisions the development of critical sub-systems for GA-ASI’s current and future UAV platforms reflecting India’s growing investment in advanced defence technologies. This key payload component is known for its compact and lightweight design and adheres to the highest environmental and MIL-STD specifications.
HFCL’s subsidiary, Raddef, is a front-runner in developing advanced radar and RF solutions. HFCL is actively developing a state-of-the-art drone detection radar, which is set to become a crucial element in modern drone detection systems. Its comprehensive range of surveillance radars is versatile, portable, and deployable across various terrains and is already well-regarded in the industry.
Its ongoing R&D initiatives encompass a wide array of radar technologies, including Ground Surveillance Radars, Weather Radars, Threat Emulators, LTE-based Passive Radars, Fog and Foliage Penetration Radars, Coastal Surveillance Radars, Avalanche Detection Radars, Muzzle Velocity Radars, and Altimeters.
As India continues to rise as a global military power, accounting for 3.7 percent of worldwide military spending, HFCL is poised to lead innovation in the Indian defence technology space.
Through its indigenous innovations and strategic collaborations, HFCL is committed to contributing to the modernization of India’s military capabilities, aligning with the Government’s Make in India policy and furthering the nation’s security and defence objectives.
About the Company
HFCL Limited is one of the leading telecom infrastructure technology companies, it is engaged in offering end-to-end solutions for establishing the network required for telecommunications, Defense communication, and railway communication in India.
HFCL Limited is the leading supplier of Optical fiber cables in India, with 5 manufacturing facilities, 3 R&D Centers, and a presence across 45+ countries. It generates 96 percent of its revenue from Telecom and Cable, 2 percent from Defence, and 2 percent from railways.
HFCL has developed capabilities to provide premium-quality Optical Fiber and Optical Fiber Cables, state-of-the-art telecom products including 5G Radio Access Network (RAN) products, 5G Transport Products, Wi-Fi Systems (Wi-Fi 6, Wi-Fi 7), Unlicensed Band Radios, Switches, Routers and Defence electronics products.
Order book and Key Customers
As of June 2024, it has a total order book worth Rs. 6,776 Crores, category wise it consists of Rs. 3092 Crores (45.63 percent) for Network services, operation, and maintenance Rs. 2,011 Crores (29.67 percent), and Products Rs. 1673 Crores (24.69 percent).
Some of its key customers include Airtel, Larsen & Toubro, Reliance Jio, Vodafone Idea ITI, Tata, Bharat Electronics, Nokia, EIL, Railtel and many more.
Financials & Ratios
Its revenue from operations grew by 16.38 percent from Rs. 995 Crores in Q1FY24 to Rs. 1,158 Crores in Q1FY25, accompanied by profits of Rs. 76 Crores to Rs. 111 Crores.
In terms of return ratios, it has reported a return on equity (ROE) of 9.38 percent and a return on capital employed (ROCE) of 13.3 percent. In terms of liquidity, it has reported a debt-to-equity ratio of 0.25.
Written by: Bharath K.S
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