en.Wedoany.com Reported - Telecom equipment manufacturer HFCL plans to invest INR 9.5 billion over the next two years to enhance its optical fiber and cable production capacity. The company's Managing Director, Mahendra Nahata, revealed this plan while announcing the launch of the OptiQ AI data center solution portfolio.

Nahata stated that the demand for optical fiber and cables in the data center sector is enormous, particularly in the U.S. market, driving industry growth. The company is expanding its optical fiber and cable production capacity and pursuing backward integration—producing preforms (the primary raw material for manufacturing optical fiber). The total capital expenditure is approximately INR 9.5 billion, to be spent over two years, with about INR 5.8 billion allocated for the preform production facility.

In terms of specific capacity expansion: cable capacity will increase from 39 million fiber core kilometers per year to 45 million fiber core kilometers per year; fiber capacity will rise from 30 million route kilometers per year to 40 million route kilometers per year. The backward integration preform facility will cost approximately INR 5.8 billion.

HFCL recorded its highest-ever order book in fiscal year 2026, reaching INR 212.06 billion, more than double the INR 99.67 billion in fiscal year 2025. The optical fiber and cable business also set an order record in the previous fiscal year, reaching INR 134.83 billion. The company aims to capture a 10% share of the global optical fiber and cable market within the next 2-3 years.

Nahata believes that the primary driver of growth in optical fiber and cable demand is the booming data center sector, underpinned by artificial intelligence-driven data generation and transmission needs. The defense sector is also contributing to growth—fiber-based drones offer better sustainability compared to radio-controlled drones and can avoid radio interference. The company has partnered with the Indian Institute of Technology Delhi to develop hollow-core optical fiber cables and cables containing 14,000 fibers. Traditional telecom operators typically use cables with a maximum of 288 fibers, while data centers are now using cables with 7,000 fibers. The company plans to design hollow-core fiber and multi-core cables based on 13,000 fibers within two years. Hollow-core fiber will be approximately 35% faster than multi-core cables, but commercialization will take time; multi-core cables are currently in high demand. The defense product portfolio is expected to contribute to consolidated revenue starting from the first quarter of the next fiscal year.