Dynamic Cables: Tax Rectification Order Reduces Liability from ₹5.02 Crore to ₹39,800

Dynamic Cables Limited, a government-recognised Two-Star Export House, recently announced a significant rectification in its income tax demand. The company has received a favourable order from the Income Tax Department, substantially reducing its tax liability for the assessment year 2022-23.

The share price of Dynamic Cables was trading 1.32% lower as of 11:40 AM on February 6, 2025.

Rectification Order Details

Dynamic Cables Limited received a rectification order from the Centralised Processing Centre (CPC) Bangalore, under Section 154 of the Income Tax Act, 1961. This revision reduced the company’s tax demand from ₹5,02,33,850 to ₹39,800.

The rectification follows an earlier assessment under Section 143(1) of the Income Tax Act, which initially resulted in a significantly higher tax liability. However, upon review and correction, the revised order reflects a substantial reduction in the amount payable.

Immediate Action Taken

Following the receipt of the rectification order, Dynamic Cables promptly deposited the revised tax amount of ₹39,800 on the same day. This action ensures compliance with the latest directive from the tax authorities.

Impact on the Company

The rectification order has no financial, operational, or strategic impact on the company’s business activities. The management has confirmed that this adjustment does not affect its ongoing projects, revenue streams, or market positioning.

Financial Performance

Dynamic Cables has delivered strong and consistent performance, achieving their highest ever revenue and profits. The company reported their highest ever 9-month revenue and record order book. In 9-month FY25 sales grew by 32% over 9-month FY24 with operating margin rising 37% to ₹71.2 crores. 

Operating margin was stable at 10.3% in accordance with our long-term guidance and PAT increased by 72% to ₹41.2 crores surpassing FY24 profits, reflecting our strong financial performance. Customer-wise contribution in 9-month FY25 was government sales 23%, private sales at 71% and export at 6%. Product-wise contribution 9-month FY25 for HV sales 61%, LV cables 29%, railway signalling cable 5%, conductors 5%. As of December 31, 2024, the order book stands at ₹682 crore. 

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