NSEI:HFCL

Stock Analysis Report

Executive Summary

HFCL Limited manufactures and sells telecom products in India and internationally.


Snowflake Analysis

Excellent balance sheet with proven track record.

Share Price & News

How has HFCL's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: HFCL has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

-4.5%

HFCL

1.0%

IN Telecom

-2.4%

IN Market


1 Year Return

-9.0%

HFCL

5.2%

IN Telecom

6.8%

IN Market

Return vs Industry: HFCL underperformed the Indian Telecom industry which returned 5.2% over the past year.

Return vs Market: HFCL underperformed the Indian Market which returned 6.8% over the past year.


Shareholder returns

HFCLIndustryMarket
7 Day-4.5%1.0%-2.4%
30 Day0.6%-1.3%-0.6%
90 Day-13.2%-3.3%7.2%
1 Year-8.6%-9.0%9.1%5.2%8.9%6.8%
3 Year39.6%38.5%8.9%-2.5%31.8%24.8%
5 Year1.7%0.9%28.7%8.4%40.3%27.8%

Price Volatility Vs. Market

How volatile is HFCL's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is HFCL undervalued compared to its fair value and its price relative to the market?

7.05x

Price to Earnings (PE) ratio


Share Price vs. Fair Value

Below Fair Value: HFCL (₹17.1) is trading above our estimate of fair value (₹1.59)

Significantly Below Fair Value: HFCL is trading above our estimate of fair value.


Price To Earnings Ratio

PE vs Industry: HFCL is good value based on its PE Ratio (7x) compared to the Telecom industry average (16.9x).

PE vs Market: HFCL is good value based on its PE Ratio (7x) compared to the Indian market (12.9x).


Price to Earnings Growth Ratio

PEG Ratio: Insufficient data to calculate HFCL's PEG Ratio to determine if it is good value.


Price to Book Ratio

PB vs Industry: HFCL is good value based on its PB Ratio (1.4x) compared to the XA Telecom industry average (1.7x).


Next Steps

Future Growth

How is HFCL forecast to perform in the next 1 to 3 years based on estimates from 0 analysts?

9.3%

Forecasted Telecom industry annual growth in earnings


In this section we usually present revenue and earnings growth projections based on the consensus estimates of professional analysts to help investors understand the company’s ability to generate profit. But as HFCL has not provided enough past data and has no analyst forecast, its future earnings cannot be reliably calculated by extrapolating past data or using analyst predictions.

This is quite a rare situation as 97% of companies covered by SimplyWall St do have past financial data.


Next Steps

Past Performance

How has HFCL performed over the past 5 years?

-0.8%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: HFCL has high quality earnings.

Growing Profit Margin: HFCL's current net profit margins (6.4%) are higher than last year (4.9%).


Past Earnings Growth Analysis

Earnings Trend: HFCL's earnings have declined by -0.8% per year over the past 5 years.

Accelerating Growth: HFCL's earnings growth over the past year (57.6%) exceeds its 5-year average (-0.8% per year).

Earnings vs Industry: HFCL earnings growth over the past year (57.6%) exceeded the Telecom industry 15%.


Return on Equity

High ROE: HFCL's Return on Equity (19.7%) is considered low.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is HFCL's financial position?


Financial Position Analysis

Short Term Liabilities: HFCL's short term assets (₹31.3B) exceed its short term liabilities (₹20.2B).

Long Term Liabilities: HFCL's short term assets (₹31.3B) exceed its long term liabilities (₹2.3B).


Debt to Equity History and Analysis

Debt Level: HFCL's debt to equity ratio (38.2%) is considered satisfactory.

Reducing Debt: HFCL's debt to equity ratio has reduced from 40% to 38.2% over the past 5 years.

Debt Coverage: HFCL's debt is not well covered by operating cash flow (6.2%).

Interest Coverage: HFCL's interest payments on its debt are well covered by EBIT (8.8x coverage).


Balance Sheet

Inventory Level: HFCL has a low level of unsold assets or inventory.

Debt Coverage by Assets: HFCL's debt is covered by short term assets (assets are 5.1x debt).


Next Steps

Dividend

What is HFCL's current dividend yield, its reliability and sustainability?

0.58%

Current Dividend Yield


Dividend Yield vs Market

company0.6%marketbottom25%0.6%markettop25%2.5%industryaverage3.6%forecastin3Yearsn/a

Current dividend yield vs market & industry

Notable Dividend: HFCL's dividend (0.58%) isn’t notable compared to the bottom 25% of dividend payers in the Indian market (0.6%).

High Dividend: HFCL's dividend (0.58%) is low compared to the top 25% of dividend payers in the Indian market (2.48%).


Stability and Growth of Payments

Stable Dividend: Whilst dividend payments have been stable, HFCL has been paying a dividend for less than 10 years.

Growing Dividend: HFCL's dividend payments have increased, but the company has only paid a dividend for 2 years.


Current Payout to Shareholders

Dividend Coverage: With its low payout ratio (4.1%), HFCL's dividend payments are thoroughly covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: Insufficient data to determine if a dividend will be paid in 3 years and that it will be covered by earnings.


Next Steps

Management

What is the CEO of HFCL's salary, the management and board of directors tenure and is there insider trading?

1.7yrs

Average board tenure


CEO

Mahendra Nahata (60yo)

14.2yrs

Tenure

₹88,000,000

Compensation

Mr. Mahendra Nahata has been the Managing Director of Himachal Futuristic Communications Ltd. since October 2005. Mr. Nahata is employed at Jumbo Techno Services Pvt. Ltd. He was one of the promoters of HF ...


CEO Compensation Analysis

Compensation vs Market: Mahendra's total compensation ($USD1.24M) is above average for companies of similar size in the Indian market ($USD333.91K).

Compensation vs Earnings: Mahendra's compensation has increased by more than 20% in the past year.


Board Age and Tenure

1.7yrs

Average Tenure

65yo

Average Age

Experienced Board: HFCL's board of directors are not considered experienced ( 1.7 years average tenure), which suggests a new board.


Insider Trading

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Management Team

  • Mahendra Nahata (60yo)

    MD & Wholetime Director

    • Tenure: 14.2yrs
    • Compensation: ₹88.00m
  • Vijay Jain (55yo)

    Chief Financial Officer

    • Tenure: 0yrs
    • Compensation: ₹17.87m
  • Manoj Baid

    VP of Corporate

    • Tenure: 13.2yrs
    • Compensation: ₹5.19m
  • Subodh Garg (67yo)

    Senior President

    • Tenure: 0yrs
  • Sushil Wadhwa (59yo)

    Senior Vice President

    • Tenure: 0yrs
  • Karan Bamba (52yo)

    Vice President

    • Tenure: 0yrs
  • Ashwani Gupta (61yo)

    Executive Director

    • Tenure: 0yrs
  • Harshwardhan Pagay (48yo)

    President

    • Tenure: 0yrs
  • Jitendra Chaudhary (46yo)

    President

    • Tenure: 0yrs
  • Vibhas Joshi (61yo)

    President

    • Tenure: 0yrs

Board Members

  • Mahendra Nahata (60yo)

    MD & Wholetime Director

    • Tenure: 14.2yrs
    • Compensation: ₹88.00m
  • Arvind Kharabanda (72yo)

    Non-Executive Director

    • Tenure: 15.2yrs
    • Compensation: ₹735.00k
  • Ranjeet Kastia (78yo)

    Non-Executive Director

    • Tenure: 10.8yrs
    • Compensation: ₹595.00k
  • Mahendra Shukla (87yo)

    Non-Executive Chairman

    • Tenure: 1.3yrs
    • Compensation: ₹700.00k
  • Ved Jain (66yo)

    Independent Director

    • Tenure: 1.3yrs
    • Compensation: ₹280.00k
  • Surendra Sirohi (64yo)

    Independent Director

    • Tenure: 1.3yrs
    • Compensation: ₹315.00k
  • Ranjeet Soni (46yo)

    Non-Executive Director

    • Tenure: 2.1yrs
    • Compensation: ₹245.00k
  • Tamali Gupta (57yo)

    Independent Women Director

    • Tenure: 1yrs
    • Compensation: ₹105.00k

Company Information

HFCL Limited's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: HFCL Limited
  • Ticker: HFCL
  • Exchange: NSEI
  • Founded: 1987
  • Industry: Integrated Telecommunication Services
  • Sector: Telecom
  • Market Cap: ₹22.477b
  • Shares outstanding: 1.28b
  • Website: https://www.hfcl.com

Location

  • HFCL Limited
  • 8, Commercial Complex
  • Masjid Moth
  • New Delhi
  • Delhi
  • 110048
  • India

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
500183BSE (Mumbai Stock Exchange)YesEquity SharesININRFeb 1995
HFCLNSEI (National Stock Exchange of India)YesEquity SharesININRFeb 1995

Biography

HFCL Limited manufactures and sells telecom products in India and internationally. It offers a range of optical fiber cables for telecommunication, NLD, access, and FTT-x networks, as well as addresses app ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2019/12/10 12:45
End of Day Share Price2019/12/10 00:00
Earnings2019/09/30
Annual Earnings2019/03/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.