HFCL shares: Why this multibagger stock is among brokers' top Diwali picks; targets -
Strong Al-led fibre demand, a record order book, large capacity expansions, rising exports and an emerging defence franchise provide multiple growth levers, analysts said.
At least two brokerages have suggested multibagger stock HFCL Ltd among their top Diwali picks, despite a 224 per cent upside in the counter so far in 2026. HFCL is undergoing a structural transformation from a telecom projects company to a global optical connectivity and defence technology player, Centrum Finserve said.
Strong AI-led fibre demand, a record order book, large capacity expansions, rising exports and an emerging defence franchise provide multiple growth levers for HFCL, it said.
On Wednesday, the scrip was trading 4.42 per cent higher at Rs 226.90 apiece.
Analysts said optical fibre cables and data-centre interconnect (DCI) account for Rs 18,500 crore of HFCL's order book, nearly 70 per cent of which is hyperscaler-linked. Data centres now contribute 65-75 per cent of telecom revenue, and capacity is being doubled ahead of demand.
On the other hand, defence revenue is guided at Rs 500-600 crore in FY27, at least Rs 2,000 crore in FY28 and Rs 5,000 crore within three years, aided by the aerospace acquisition, which is expected to close in Q3FY27 and has an executed order book of Rs 1,600-1,800 crore, they said.
The Rs 121 crore EPC loss is largely timing-related, with losses capped at Rs 75-100 crore over the next two quarters and profitability expected from Q1FY28, Arihant Capital Markets said.
"With robust earnings visibility and improving profitability, HFCL is well positioned to generate superior shareholder returns over the next few years. We recommend BUY with a target of Rs 290," Centrum Finserve said.
Arihant Capital Markets sees HFCL shares nearly doubling from the prevailing price, with a target price of Rs 495.
The brokerage said the company's management had upgraded its FY27 guidance to at least 80 per cent year-on-year (YoY) growth, with its Rs 10,000 crore revenue aspiration now expected well before FY29. It estimated revenue, Ebitda and PAT CAGRs of 51.2 per cent, 82.3 per cent and 113 per cent, respectively, over FY26-29E, with RoE projected to rise from 7.3 per cent to 32 per cent.
The stock trades at around 22.2 times its estimated FY28 EPS. Arihant maintained its 'Buy' rating with a sum-of-the-parts (SOTP)-based target price of Rs 495.
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