HFCL Limited’s Board of Directors has approved an additional capital expenditure of approximately ₹820 crore for the expansion of its Optical Fiber, Optical Fiber Cable, and Preform manufacturing capacities. This investment will increase HFCL’s total planned capex for these initiatives to approximately ₹1,800 crore, enhancing its integrated manufacturing platform and reinforcing its market position.
HFCL Boosts Manufacturing Capacity with ₹820 Crore Investment
HFCL Limited has announced a significant strategic move to bolster its manufacturing capabilities with the approval of an additional capital expenditure of approximately ₹820 crore. This investment is earmarked for the expansion of its Optical Fiber, Optical Fiber Cable, and Preform manufacturing capacities, reinforcing the company’s commitment to meeting the growing global demand for optical communication infrastructure.
Expanded Capacities and Total Capex
The approved expansion will add 4.60 Million Fiber Kilometers (Mn fkm) per annum for Optical Fiber, 5.64 Mn fkm per annum for Optical Fiber Cable, and 300 Metric Tonnes (MT) per annum for Preform. This new investment is in addition to the ₹980 crore previously approved for similar projects, bringing the total planned capital expenditure for these capacity enhancement initiatives to approximately ₹1,800 crore.
Upon completion, HFCL’s manufacturing capacities will reach 43.10 Mn fkm per annum for Optical Fiber, 62.00 Mn fkm per annum for Optical Fiber Cable, and 600 MT per annum for Preform. The expansion is expected to be completed by July 2028 for OF and OFC, and by October 2028 for the Preform manufacturing facility.
Strategic Rationale and Funding
This expansion is driven by HFCL’s strong order book, robust pipeline of business opportunities, and the favourable long-term demand outlook for optical communication infrastructure. The investment aims to create a larger, integrated, and more resilient manufacturing platform, covering critical stages of the value chain from Preform to Connectivity Solutions. The funding will be through a mix of internal accruals, proceeds from preferential issue of warrants, and borrowings from financial institutions.
The Preform manufacturing facility is a key component, strengthening backward integration, securing raw material access, and enhancing supply chain resilience. This initiative is expected to improve cost efficiencies and margin enhancement, positioning HFCL for sustained long-term growth and reinforcing its leadership in both domestic and international markets.
Market Drivers
The company highlights that the rapid expansion of hyperscale data centres, AI infrastructure, cloud computing, and telecom network modernization are driving significant demand for high-capacity, reliable, and low-latency optical connectivity. Initiatives like fiber-to-the-home, enterprise fiberisation, and government-led digital infrastructure programs further contribute to this growing market need.
Source: BSE
