HFCL Limited has reported a challenging first quarter, marked by a significant decline in revenue and a swing to net loss. The telecom equipment maker has also announced major strategic initiatives, including a substantial fund-raising plan and a proposal to relocate its registered office.

Financial Performance

HFCL reported a consolidated net loss of ₹32.00 crore for the quarter, a stark contrast to the profit of ₹111.00 crore recorded in the same quarter last year. The company's revenue from operations saw a substantial decline of 25% year-on-year, dropping to ₹871.00 crore from ₹1,158.00 crore in the corresponding quarter of the previous year.

The company's EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization) experienced a sharp fall of 83%, reaching ₹29.00 crore compared to ₹174.00 crore in the same period last year. Consequently, EBITDA margins contracted significantly to 3.3% from 15% in the year-ago quarter.

Strategic Initiatives

Despite the challenging quarter, HFCL's board has approved several strategic moves aimed at future growth and operational efficiency:

1. Fund Raising Plan: The board has given the green light to raise up to ₹700.00 crore through various means, including equity or convertible instruments. This capital infusion is intended for strategic investments, expansion in the defence and telecom sectors, working capital needs, and debt repayment.

2. Registered Office Relocation: HFCL has proposed shifting its registered office from Solan, Himachal Pradesh to Gurugram, Haryana. This move is subject to shareholder approval and regulatory clearances.

3. Expansion Plans: The company plans to strategically deploy the raised funds for various growth initiatives, including organic and inorganic expansion, acquisitions in related spaces, and exploring new business opportunities.

Market Response

The market reacted negatively to the financial results, with HFCL's stock trading over 4% lower on the day of the announcement. The stock has witnessed a significant decline of 33.53% in the current year, reflecting investor concerns about the company's performance and broader market conditions.

Management Commentary

Manoj Baid, President & Company Secretary of HFCL, stated in the company's filing, "We believe this initiative will empower us to seize new opportunities with speed and confidence. It reflects our commitment to long-term value creation and sustainable growth for all stakeholders."

The company's management views the fund-raising plan as a strategic move to leverage emerging opportunities in the defence and telecommunications sectors, while also strengthening HFCL's capital base and financial position.

As HFCL navigates through these challenging times, the success of its strategic initiatives and the effective utilization of the proposed funds will be crucial in determining the company's future trajectory in the competitive telecom and defence equipment market.

HFCL Limited , a prominent player in the telecommunications and defense sectors, has officially opened its ₹700 crore fundraising initiative through a Qualified Institutional Placement (QIP) with detailed pricing and documentation now in place.

QIP Officially Launched with Floor Price

The Fund Raising Committee of Directors has taken decisive action on December 22, 2025, officially opening the proposed QIP and establishing key parameters for the fundraising initiative. The committee meeting, held from 8:10 PM to 8:30 PM, approved critical aspects of the offering.

The floor price of ₹65.84 per equity share has been determined based on the pricing formula prescribed under Regulation 176(1) of the SEBI ICDR Regulations. The company retains the discretion to offer a discount of up to 5% on this floor price, as approved by shareholders.

Regulatory Compliance and Documentation

The QIP is being conducted in full compliance with regulatory requirements, including Chapter VI of SEBI (Issue of Capital and Disclosure Requirements) Regulations, 2018, and Sections 42 and 62 of the Companies Act, 2013. The committee has approved and adopted the preliminary placement document dated December 22, 2025, which has been filed with stock exchanges and made available on the company's website at https://www.hfcl.com/qip-2025 .

The company has formally notified BSE Limited and National Stock Exchange of India Limited about the QIP launch, with the preliminary placement document filed as compliance under Regulation 30 and other applicable regulations of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

Strategic Fundraising Objectives

The ₹700 crore fundraising initiative is designed to support multiple strategic objectives across HFCL's business operations. The company plans to utilize the funds for leveraging growth opportunities in defense and telecommunications sectors, supporting strategic investments, and strengthening its capital base.

Market Context and Financial Performance

The QIP launch comes amid challenging first quarter results, with the company reporting a consolidated net loss of ₹322.00 million compared to a profit of ₹1.10 billion in the previous year. Revenue declined by 25.00% year-over-year to ₹8.70 billion, while EBITDA margin contracted significantly to 3.26% from 15.03%.

The trading window for designated persons and their immediate relatives remains closed from November 18, 2025, until December 28, 2025, for the purpose of the QIP. The issue price will be determined by the company in consultation with the appointed Book Running Lead Manager, providing flexibility in final pricing based on market conditions and investor demand.