HFCL optical fibre push 2026: ₹10,159cr deal, new plants

What HFCL has announced across its fibre business

HFCL has laid out a set of fibre-related updates spanning manufacturing, capital expenditure, and export-linked order wins. The disclosures cover the commissioning of an optical fibre plant in Hyderabad, fresh and cumulative international orders for optical fibre cable (OFC), and a large multi-year supply agreement with a global multinational corporation. Separately, the company has approved an investment plan for a new optical fiber preform manufacturing facility through its wholly owned subsidiary.

Taken together, these developments point to a strategy built around backward integration, capacity expansion, and scaling exports. HFCL has also indicated that backward integration can strengthen the supply chain and improve operating margins. In a separate discussion on expansion plans, HFCL’s managing director referred to a potential margin improvement of 5 percent to 6 percent linked to backward integration.

Hyderabad greenfield optical fibre plant commissioned

HFCL has said its greenfield optical fibre manufacturing facility at Telangana, Hyderabad has been commissioned and commenced commercial production with effect from January 23, 2020. The company described the unit as a state-of-the-art plant. It also disclosed the capital outlay incurred till that date.

The initial installed capacity of the plant is 6.40 million fibre kilometres per annum, and it has been designed to scale up to 9.60 million fibre kilometres per annum in the future. HFCL said it had already made an outlay of ₹236 crore to set up the plant, till date. The company also stated that on commissioning, backward integration benefits are expected to strengthen its supply chain and enhance operating margins.

HFCL added that the entire output of 6.40 million fibre kilometres of optical fibre would be available to the company for captive consumption as a key raw material required for production of optical fibre cables, and also for sale to other OFC manufacturers.

International OFC orders: ₹106 crore and ₹183.95 crore

HFCL has reported multiple export-facing order wins for optical fibre cable supply. In one update, the company said it has won an order worth $11.07 million, approximately ₹106 crore, for the supply of optical fibre cable to an international customer.

In addition, HFCL said it has also recently received two orders cumulatively worth ₹183.95 crore to manufacture and supply optical fibre cables to international customers. The disclosures did not provide the names of the customers or delivery schedules, but they reinforce the company’s stated focus on overseas demand for OFC.

These order announcements sit alongside the company’s broader manufacturing expansion narrative, where stable access to fibre and preform is positioned as an advantage for fulfilling large OFC commitments.

Landmark five-year OFC supply agreement worth ₹10,159 crore

HFCL has also disclosed a major multi-year supply agreement valued at approximately ₹10,159 crore, equivalent to about $1.10 billion, with an undisclosed global multinational corporation. HFCL described it as the largest long-term optical fibre cable deal in its history. The company said the total potential value of the contract over its tenure is estimated at around $1.10 billion, equivalent to around ₹10,159 crore, based on prevailing selling prices of OFC products being supplied.

The agreement covers the supply of high-quality, high-fibre-count optical fibre cables used in telecom networks and broadband infrastructure. HFCL also stated that it will supply OFC through its overseas wholly owned subsidiary.

The deal includes minimum quantity commitments of multi-million fibre kilometres of high-quality, high-fibre-count OFC to be supplied in each calendar year starting from CY26 to CY28. The arrangement is structured to automatically extend to two additional calendar years, CY29 and CY30.

Preform plant plan: ₹580 crore capex, completion targeted by July 2029

HFCL Limited has approved an investment of ₹580 crore to set up a new optical fiber preform manufacturing facility through its wholly owned subsidiary, HFCL Technologies Pvt. Ltd. The proposed facility is expected to have an annual capacity of around 300 to 310 metric tonnes. HFCL has indicated that the project is expected to be completed by July 2029.

The company has positioned the preform facility as a backward integration step intended to strengthen supply chain resilience. In a discussion around the rationale, HFCL’s managing director described the backward integration decision as linked to supply-side challenges and margin improvement, stating that margin improvement could be to the tune of 5 percent to 6 percent.

HFCL has also said the preform project would cover roughly 300 to 310 tons of preform, which it described as about one-third of its total requirement, and referred to it as the first phase.

Fibre capacity scale-up: from 14 million to 33.90 million fkm target

HFCL has shared capacity milestones and targets for its optical fibre manufacturing. It said its optical fiber manufacturing capacity has already been scaled up from 14 million fibre kilometres to 28 million fibre kilometres, and it is now being targeted to reach 33.90 million fibre kilometres, with further expansion under consideration.

In another update, HFCL said it has revised plans to expand optical fiber manufacturing capacity from 10 million fibre kilometres per year to 33.9 million fibre kilometres per year, compared with an earlier plan of 24.94 million fibre kilometres per year. For that capacity expansion, the company said it had earmarked an investment of ₹470 crore and would use a combination of debt and internal funds, with completion expected by December 2024.

HFCL has stated it has an optical fiber and optical fiber cable manufacturing plant in Hyderabad and an optical fiber cable manufacturing plant in Goa. It also described the expansion as an extension of earlier plans for the Hyderabad facility.

Poland OFC plant proposal: ₹144 crore investment

HFCL has also planned an investment of approximately ₹144 crore for setting up an optical fibre manufacturing facility in Poland as part of its global expansion strategy. The proposed OFC manufacturing plant is scheduled to begin with a capacity of 3.25 million fibre kilometres and is scalable up to 7 million fibre kilometres.

The company has described the project as a step to expand its presence in Europe. Beyond capex and capacity, no commissioning timeline or funding mix was provided in the supplied information.

Fundraising via warrants: ₹555 crore proposal and key terms

To support capital-intensive growth plans, HFCL’s Board approved issuance of up to 7,50,00,000 warrants convertible into equity shares at ₹74 per share, aggregating to approximately ₹555 crore. The warrants are proposed to be issued to two promoter entities, NextWave Communications Private Limited and Satellite Finance Private Limited, in equal proportions of up to 3,75,00,000 warrants each.

The issue is subject to shareholder approval at an Extra-Ordinary General Meeting scheduled for April 24, 2026. Each warrant is exercisable within 18 months from the date of allotment. HFCL has also disclosed that 25 percent of the exercise price is payable upfront and the remaining 75 percent at the time of conversion.

In a separate discussion, HFCL’s managing director also referred to plans to raise around ₹555 crore via warrants and said part of the funds would be used for manufacturing of preform, part for the defence business, and part for long-term working capital requirements.

Key facts at a glance

Market impact: what the disclosures imply for execution

HFCL’s updates point to a focus on securing raw material availability and scale for OFC manufacturing. The Hyderabad optical fibre plant was explicitly positioned as a backward integration move, with the entire initial output of 6.40 million fibre kilometres available for captive consumption and also for sale. That matters because OFC manufacturers are exposed to input availability and pricing for fibre and preform.

The ₹10,159 crore supply agreement, with minimum annual delivery commitments from CY26 to CY28 and an automatic extension to CY29 and CY30, implies sustained delivery requirements over multiple years. HFCL has said supply under this arrangement will be routed through its overseas wholly owned subsidiary, while manufacturing is to be done in India for the overseas client.

The company has also connected backward integration to profitability, with an indicated margin improvement potential of 5 percent to 6 percent linked to integration. While HFCL has not provided a quantified margin baseline in the supplied information, the combination of internal fibre availability, planned preform capacity of 300 to 310 MT per year, and the funding plan via ₹555 crore warrants lays out how it intends to support its build-out.

Conclusion

HFCL’s fibre narrative combines three elements: operating manufacturing assets such as the Hyderabad optical fibre plant, large export-linked OFC orders including a ₹10,159 crore multi-year agreement, and planned investments such as the ₹580 crore preform facility targeted for completion by July 2029. The next formal milestone disclosed is the shareholder vote at the Extra-Ordinary General Meeting scheduled for April 24, 2026 for the proposed warrants issue. Separately, HFCL’s large OFC supply agreement includes minimum annual delivery commitments beginning CY26.