Telecom gear maker HFCL Ltd on Monday said its board has approved an additional ₹820 crore capital expenditure to expand its optical fibre , optical fibre cable and preform manufacturing capacities, taking the total planned capex for these capacity expansion projects to around ₹1,800 crore."The additional capital expenditure for the proposed capacity expansions is estimated at approximately ₹820 crore.
The investment will be funded through an appropriate mix of internal accruals, proceeds from the preferential issue of warrants already issued to the Promoter, Promoter Group entity, borrowings from financial institutions/banks and/or other suitable financing arrangements, as may be required.
The above capacity expansion is in addition to the aggregate capital expenditure of approximately ₹980 crore already approved by the board for optical fiber, optical fiber cable and preform manufacturing projects, taking the total planned capital expenditure for these capacity enhancement initiatives to approximately ₹1,800 crore," according to a stock exchange filing.
The additional investment will add 4.60 million fibre kilometres per annum of optical fibre capacity, 5.64 Mn fkm per annum of optical fibre cable capacity and 300 metric tonnes per annum of preform capacity, HFCL said in an exchange filing on Monday.
Upon completion of the current and proposed expansions, HFCL’s manufacturing capacity will rise to 43.10 Mn fkm per annum for optical fibre, 62 Mn fkm per annum for optical fibre cable and 600 MT per annum for preform. The ₹820 crore additional investment comprises ₹670 crore for preform and ₹150 crore for optical fibre and optical fibre cable capacity expansion.
The optical fibre and optical fibre cable capacity expansion projects are expected to be completed by July 2028, while the preform manufacturing facility is expected to be established by October 2028. The preform manufacturing facility will be implemented through HFCL’s wholly owned subsidiary, HFCL Technologies Private Ltd.
HFCL said the investment will be funded through an appropriate mix of internal accruals, proceeds from the preferential issue of warrants already issued to the promoter and promoter group entity, borrowings from financial institutions and banks, and other suitable financing arrangements.
Capacity expansionHFCL’s existing optical fibre capacity is 28 Mn fkm per annum, with an ongoing expansion taking it to 38.50 Mn fkm. The latest proposal will add another 4.60 Mn fkm, taking the total capacity to 43.10 Mn fkm. The proposed addition of 5.64 Mn fkm will take total capacity to 62 Mn fkm.
The company currently has an ongoing preform capacity of around 300 MT per annum. The proposed addition of another 300 MT will take the total capacity to 600 MT per annum. HFCL said the expanded platform will cover the manufacturing value chain from preform to optical fibre, optical fibre cable and connectivity solutions.
The company said demand for optical connectivity is being supported by hyperscale data centres, artificial intelligence infrastructure, cloud computing, high-performance computing, telecom network expansion, fibre-to-the-home deployments, enterprise fibreisation, rural connectivity initiatives and telecom network modernisation programmes.
HFCL said this will reduce dependence on external suppliers, strengthen supply chain resilience and support its optical fibre and optical fibre cable expansion plans. Shares of HFCL Ltd ended at ₹233.45, down by ₹0.15, or 0.064%, on the BSE.