HFCL has delivered its highest-ever quarterly financial performance for Q1FY27, reporting a consolidated net profit of ₹245.64 crore against a loss of ₹29.30 crore in the corresponding period of the previous year. The company achieved a record revenue of ₹1,914.98 crore, marking a 119.85% year-on-year increase, driven by strong export growth and robust demand for data centre connectivity products. The order book reached approximately ₹26,665 crore, nearly five times the FY26 revenue, providing strong visibility for future growth.

Financial Performance and Margins

The turnaround was underpinned by significant expansion in operating profitability. EBITDA surged to ₹445.27 crore from ₹42.93 crore in the previous year, with the EBITDA margin expanding to 23.25% from 4.93%. Profit Before Tax (PBT) stood at ₹331.52 crore compared to a loss of ₹44.70 crore in Q1FY26. On a standalone basis, the company reported a revenue of ₹1,607.80 crore, EBITDA of ₹336.35 crore, and a net profit of ₹179.21 crore.

Strategic Expansion and Business Highlights

HFCL's Board approved an investment of approximately ₹215 crore to establish a state-of-the-art manufacturing facility for advanced AI Data Centre Connectivity Solutions. The facility will have a capacity of 2,70,000 assemblies per annum and is expected to be commissioned by September 2027. This move aims to capitalize on the rising demand from hyperscale data centres and cloud infrastructure.

Export revenue stood at ₹1,063.30 crore, constituting 55.53% of total revenue, a significant increase from ₹209.70 crore (24.08%) in Q1FY26. The product segment contributed 85% of total revenue. Additionally, the company is progressing with capacity expansion for Optical Fiber and Optical Fiber Cable, increasing capacities to 34 million fiber kilometres and 43 million fiber kilometres respectively.

Defence and Aerospace Initiatives

HFCL is scaling its Defence & Aerospace business through indigenous technology development. The company initiated the process of setting up an Ammunition Manufacturing Complex in Andhra Pradesh for Multi-mode Hand Grenades, Electronic Fuzes, and other ammunition products. The portfolio is also expanding across surveillance Radars, Thermal Imaging Sites, and Tactical Communication Solutions.

Managing Director Mr. Mahendra Nahata attributed the performance to the convergence of AI, digital infrastructure, and defence modernisation, stating that the company has entered a phase of accelerated and profitable growth.

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HFCL Limited has recommended a dividend of 20%, or Re.0.20 per equity share of face value ₹1, for the financial year 2025-26. The Board of Directors approved the recommendation at its meeting held on April 30, 2026. The payout is subject to declaration by shareholders at the ensuing 39th Annual General Meeting and will be paid within 30 days of such approval.

The dividend distribution will comply with the provisions of the Income Tax Act, 2025, which mandates that dividend is taxable in the hands of shareholders. Consequently, the company will deduct tax at source (TDS) at prescribed rates. The applicable withholding tax rate varies based on the residential status of the shareholder and the documentation submitted. For resident individuals, no tax is deducted if the aggregate dividend during the financial year does not exceed ₹10,000. A rate of 10% applies if a valid PAN is updated in the company's records, while 20% is deducted if the PAN is invalid or not linked with Aadhaar.

Resident shareholders seeking exemption must submit specific forms, such as Form 121 or a lower/nil tax deduction certificate issued by the Income Tax department under Section 395 of the Income Tax Act, 2025. Non-resident shareholders, including Foreign Institutional Investors and Foreign Portfolio Investors, face a TDS rate of 20% plus applicable surcharge and cess, unless a beneficial tax treaty rate applies. To avail of treaty benefits, non-residents must provide documents including a Tax Residence Certificate, PAN card, and self-declarations regarding permanent establishment and beneficial ownership.

TDS Rates for Resident Shareholders

TDS Rates for Non-Resident Shareholders

Shareholders holding shares in physical form must update their KYC details, including PAN and bank account details, to receive dividend payments electronically. The company has mandated that dividend to physical shareholders will be paid only via electronic mode after these details are furnished. All shareholders are requested to ensure their bank account details, residential status, and contact information are updated in their demat accounts.

To ensure the correct withholding tax rate is applied, shareholders must submit the requisite documents to the company's Registrar and Transfer Agent, MCS Share Transfer Agent Limited, or via email to tdsexm@hfcl.com . The deadline for submission is August 16, 2026. Documents received after this cutoff will be accepted at the sole discretion of the company. Non-resident non-individual members may alternatively submit documents through their custodian registered on the NSDL platform.