Strong Financial Performance Driving Investor Confidence
Universal Cables’ recent surge is underpinned by its impressive quarterly results declared in September 2025, which showcased an 81.66% growth in net profit. The company has reported positive results for two consecutive quarters, signalling consistent operational strength. Particularly striking is the growth in profit before tax excluding other income, which soared by 261.87% to ₹51.82 crores, alongside a 160.8% increase in profit after tax to ₹47.68 crores. These figures highlight a significant improvement in profitability, which has evidently resonated well with investors.
Moreover, the company’s operating cash flow for the year reached a peak of ₹175.62 crores, reinforcing the quality of earnings and cash generation capabilities. This robust financial health is further supported by a return on capital employed (ROCE) of 7%, which, combined with an enterprise value to capital employed ratio of 1.4, suggests an attractive valuation relative to its peers. The stock’s price-to-earnings-to-growth (PEG) ratio of 0.4 also indicates that the market may be undervaluing the company’s growth prospects, making it an appealing proposition for value-conscious investors.
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Market Performance and Trading Dynamics
Despite a slight negative return of 0.28% over the past week, Universal Cables has outperformed its sector by 2.37% on the day of the price rise, reflecting a strong relative performance. The stock has been on a positive trajectory for the last two days, delivering a cumulative return of 7.45% during this period. Intraday, the share price touched a high of ₹903.05, marking a 5.53% increase, which underscores the bullish sentiment prevailing among traders.
From a technical standpoint, the stock is trading above its 5-day, 50-day, 100-day, and 200-day moving averages, indicating a solid upward momentum. However, it remains slightly below its 20-day moving average, suggesting some short-term consolidation. Notably, investor participation has increased, with delivery volumes on 19 December rising by 17.6% compared to the five-day average, signalling heightened buying interest and confidence in the stock’s prospects.
Liquidity remains adequate, with the stock’s trading volume supporting trade sizes of approximately ₹0.15 crores, making it accessible for both retail and institutional investors. This liquidity, combined with the stock’s valuation and earnings growth, contributes to its attractiveness in the current market environment.
Consistent Long-Term Returns and Shareholder Structure
Universal Cables has demonstrated remarkable consistency in delivering returns over the medium to long term. Over the past year, the stock has generated a 20.55% return, significantly outperforming the Sensex’s 9.64% gain. Its three-year return of 244.29% and five-year return of 567.70% far exceed the benchmark’s respective 40.68% and 85.99% returns, highlighting the company’s sustained growth trajectory and investor value creation.
The majority shareholding by promoters provides stability and confidence in the company’s strategic direction, which is often viewed favourably by the market. This stable ownership structure, combined with consistent profit growth and attractive valuation metrics, supports the stock’s upward momentum.
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Conclusion: Why Universal Cables Is Rising
The rise in Universal Cables’ share price on 22 December is a reflection of its strong financial results, consistent profit growth, and favourable valuation metrics. The company’s ability to deliver positive quarterly results consecutively, coupled with significant increases in profit before tax and net profit, has bolstered investor confidence. Enhanced trading volumes and the stock’s position above key moving averages further reinforce the bullish sentiment.
While the broader market and sector have shown mixed returns recently, Universal Cables’ outperformance and long-term track record of delivering substantial returns make it a compelling stock for investors seeking growth with reasonable valuation. The promoter-backed ownership and robust cash flow generation add to the stock’s appeal, explaining the recent price appreciation and sustained investor interest.
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