Global Economy

The global economy has faced a series of challenges in recent years, ranging from the COVID-19
pandemic to geopolitical tensions like the Russia–Ukraine war. These disruptions have caused supply
chain bottlenecks, elevated commodity prices, and increased inflation globally. Central banks,
particularly the US Federal Reserve, responded by tightening monetary policies through aggressive
interest rate hikes, which had ripple effects across emerging markets.

As a result of these headwinds, global GDP growth moderated. According to IMF estimates, global GDP
growth was around 3.1% in 2023, down from 3.5% in 2022. Growth is expected to remain tepid in the
near term due to weak global trade, high interest rates, and geopolitical uncertainties. Advanced
economies like the US and the Eurozone are expected to witness subdued growth, while China’s
recovery remains uneven, dampening global sentiment.

Inflation remained elevated through most of 2022 and early 2023 but has shown signs of easing due to
falling energy prices and normalization in supply chains. However, core inflation continues to be sticky,
prompting central banks to maintain a cautious stance. The US Fed is expected to hold rates higher for
longer to ensure inflation is firmly under control, which may impact capital flows to emerging markets
like India.

Global trade volumes have been under pressure due to protectionist policies, re-shoring of
manufacturing, and trade tensions among major economies. The restructuring of global supply chains,
partly driven by China+1 strategies, has led to new opportunities for countries like India and Vietnam.
This shift is reshaping manufacturing and export dynamics across sectors, including electrical goods and
electronics.

The global economic outlook remains uncertain but cautiously optimistic. While growth is expected to
remain moderate, easing inflation and stable financial markets could support recovery. Any escalation
in geopolitical conflicts or unexpected tightening by central banks could pose downside risks. However,
structural shifts in global manufacturing and trade present long-term opportunities for emerging
economies like India.

Exhibit 1: Showing global GDP

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6
5
4
3
2
1
0
-1

2024 2025 2026

Indian Economy
India has emerged as a resilient economy amid global headwinds, maintaining steady growth despite
external uncertainties. While global GDP growth slowed down, India remained one of the fastest-
growing major economies in FY23–24. This resilience is attributed to strong domestic consumption,
robust infrastructure spending, and structural reforms implemented over the past few years. India's
economic management during the post-pandemic period has gained global recognition for balancing
growth and inflation effectively.

India's GDP grew by around 7.3% in FY24, driven by strong performance in manufacturing,
construction, and services. Investment activity remained healthy, supported by government capital
expenditure and improving private sector confidence. The outlook for FY25 remains positive, with
GDP growth projected at around 6.5%–7%, underpinned by improving rural demand, easing inflation,
and policy continuity. Continued momentum in urban consumption and recovery in rural demand are
expected to support broad-based growth.

After peaking in early FY23, inflation has moderated within the RBI’s target range of 4%–6%. A stable
food supply, cooling crude oil prices, and proactive monetary policy helped ease price pressures. The
RBI has adopted a cautious stance, maintaining the repo rate at 6.5% for most of FY24 to ensure price
stability without hurting growth. Lower inflation could create room for future rate cuts, which may
stimulate investment and consumption in the medium term.

One of the key pillars of India's recent economic performance has been the government's aggressive
focus on infrastructure. The Union Budget for FY25 continued this trend, with a planned capital
expenditure outlay of ₹11.1 lakh crore, a 16.9% increase over the previous year. This includes
investment in roads, railways, renewable energy, and housing. The multiplier effect of this capex is
expected to generate employment, boost demand for core industries, and support the broader
economy.

Driven by the ‘Make in India’ initiative and the Production Linked Incentive (PLI) schemes, India’s
manufacturing sector has shown renewed vigor. Sectors like electronics, white goods, and
components are gaining traction, attracting both domestic and foreign investment. At the same time,
strong urban consumption, improving rural sentiment, and rising disposable incomes are driving
demand for consumer goods, including FMEG and electrical products.

Exhibit 2: Showing India GDP

Industry Overview
Indian Wires & Cables (W&C)
The Indian wires and cables industry is a key part of the electrical equipment sector and forms around
40–45% of the total electrical industry. It includes products like power cables, control cables,
instrumentation cables, building wires, flexible cables, and others. Over the years, this industry has
grown from being unorganized to a more structured and branded space, especially with the rise in
safety awareness and increased infrastructure investments.
The market has been growing steadily and is expected to reach ₹1.2 lakh crore by FY27, from about
₹78,000 crore in FY23, indicating a CAGR (Compound Annual Growth Rate) of 12% over FY23–27 .
The key growth drivers of the Indian wires and cables industry include rising government investments
in infrastructure such as railways, metros, smart cities, defence, and rural electrification, supported by
schemes like RDSS, BharatNet, PM Gati Shakti, and PLI programs. The booming real estate sector and
growing urban housing demand, coupled with increasing electrical appliance usage, are also fueling
demand for low-voltage and house wires. Additionally, industrial capital expenditure in sectors like
data centers, manufacturing, and renewables is boosting demand for specialized cables. A significant
shift from unorganized to organized branded players is also underway, driven by increasing consumer
awareness around safety, quality, and after-sales service.
Key trends in the Indian wires and cables industry include a strong rise in exports, with Indian
manufacturers now supplying to over 60 countries and export growth clocking an 18% CAGR over
FY18–23. Companies are also upgrading their product offerings by investing in advanced, fire-resistant,
green, and high-performance cables. Branded players are rapidly expanding their distribution
networks into Tier 2/3 cities and rural areas to capture more market share. Additionally, many leading
firms are adopting backward integration strategies to reduce costs and improve quality by
manufacturing their own raw materials like copper/aluminum rods and PVC compounds.

Exhibit 3: Showing Wires & Cables Market Size (India)

Industry Overview
Fast Moving Electrical Goods (FMEG)
The Fast-Moving Electrical Goods (FMEG) sector is a dynamic segment of the broader electrical and
consumer durables industry, encompassing products that are used frequently and replaced or upgraded
often. This includes items like fans, switches, LED lighting, water heaters, kitchen appliances, and small
domestic electrical products.
India’s FMEG sector has emerged as a key component of the country’s manufacturing and consumption
ecosystem, fueled by urbanization, electrification, rising disposable incomes, and increasing emphasis
on energy-efficient products.
The Indian FMEG market was estimated at ₹1.5 lakh crore in FY23 and is expected to reach ₹2.5 lakh
crore by FY27, implying a CAGR of ~13%.

The key growth drivers of the FMEG industry in India include rapid urbanization and government-led
electrification programs that are expanding market access, especially in rural and semi-urban areas.
Rising disposable incomes are fueling demand for premium and aesthetically designed products like
modular switches, designer fans, and smart appliances. There is also a strong shift toward energy-
efficient products, supported by BEE star ratings and consumer awareness. Government initiatives like
the PLI scheme, Make in India, and Atmanirbhar Bharat are further encouraging local manufacturing and
product innovation, boosting overall industry growth.

Emerging trends in the FMEG sector include the growing adoption of smart products integrated with IoT
and automation, particularly in lighting, fans, and switches, driven by rising urban tech-savvy
consumers. Companies are expanding their reach into Tier 2/3/4 cities through enhanced distribution
networks and brand outlets. There is a clear shift toward premium, aesthetically designed, and multi-
functional products as consumer preferences evolve. E-commerce is playing a larger role in sales,
especially for lighting and small appliances. Additionally, brands are focusing on green manufacturing
practices, such as sustainable packaging and renewable energy usage, to align with environmental goals
and consumer expectations.

Exhibit 4: FMEG Revenue (Rs. Mn)

Industry Overview
Electrical Fans
The electrical fans market in India is expected to reach ₹16,259 crore by FY28, growing at a CAGR of
11.5% from FY23. This growth is driven by rising urbanization, increasing electrification in rural areas,
and growing aspirations of middle-class consumers. Premiumization is becoming a key trend, with
consumers shifting toward decorative and energy-efficient fans. The market is split into organized and
unorganized segments, but the organized sector is gaining share due to stronger branding and wider
distribution. South India is the largest contributor, accounting for around 30% of the total market.
Innovations like IoT-enabled fans and BLDC (brushless direct current) technology are reshaping
consumer preferences. The introduction of star labeling for energy efficiency is expected to boost
replacement demand. Price competition remains intense, but companies with strong brand equity
and R&D capabilities are better positioned. Exports are also growing, especially to emerging markets.
The replacement cycle is relatively long, typically over 5 years. Market leaders are increasingly
focusing on digital marketing and D2C sales channels.
Exhibit 5: India’s fan market size (INR B)

Exhibit 6: Fans domination in the FMEG mix (%)

Industry Overview
Lighting & Luminaries
The lighting and luminaires market is experiencing a major transformation, primarily due to the rapid
adoption of LED technology. The government’s UJALA scheme and bans on incandescent bulbs have
accelerated LED penetration, making it the dominant segment. LEDs account for over 75% of the
lighting market today. The industry is forecasted to reach ₹45,000 crore by FY28. Residential,
commercial, and industrial segments all contribute, with smart lighting gaining traction in premium
homes and office spaces. Growth is also propelled by urban infrastructure projects and smart city
initiatives. While the LED market has matured somewhat, there is still significant room for innovation in
design, connectivity, and automation. Price erosion in LEDs has impacted margins, but volume growth
has offset some of this pressure. The segment also sees strong seasonal demand, especially during
festive periods. Leading players are focusing on design differentiation, smart lighting systems, and
sustainability. Exports are growing, but domestic demand remains the key driver.
Exhibit 7: Lighting Industry Market Size (India)

Switches & Switchgears

The Indian switches and switchgear market is poised for steady growth, projected to reach ₹16,826
crore by FY28 at a CAGR of 9.6%. This segment benefits from rising electrification, construction activity,
and increasing safety awareness. Modular switches are witnessing higher demand due to aesthetic
appeal and ease of installation. The premiumization trend is evident, especially in urban markets and
among new residential and commercial developments. Switchgear, including MCBs and distribution
boards, is crucial for electrical safety and is driven by rising awareness among consumers and builders.
Smart switches and IoT-enabled controls are emerging as a niche but fast-growing segment. The
unorganized market still exists, but organized players dominate due to brand trust and regulatory
compliance. Real estate recovery and infrastructure push from the government are additional tailwinds.
Rural electrification programs and growth in tier-2 and tier-3 cities are expanding the market base.
Companies are also focusing on value-added services and integrated electrical solutions.
Industry Overview

Exhibit 8:Indian Switches & Switchgears Market (INR B)

Exhibit 9:Traditional & Modular Switches Market (INR B)

Conduits & Fittings

The conduits and fittings business experienced solid double-digit growth, benefiting from the ongoing
strength in the real estate sector. These products are essential for routing and protecting electrical
wiring and are made from high-quality waterproof and fire-resistant polymers to ensure enhanced
safety for electrical circuits. Typically installed within walls, conduits and fittings are considered low-
cost items, which often leads to lower customer awareness about their quality standards. The market
for these products is characterized by low entry barriers, resulting in a highly fragmented landscape
where roughly 30%-40% of the market remains unorganized. In FY 2023-24, the market size for
conduits and fittings reached ₹75 billion.
Industry Overview
Copper & Aluminium – Key raw material across cables & wires
Copper and aluminum are the key raw materials used in cables & wires and form a major chunk of the
raw material costs. The cost fluctuations in these materials define the margins of cables & wires for
the company. Most companies typically have a 90-day window from the raw material procurement
date wherein they can fix the price of cables & wires based on fluctuations in copper and aluminum
rates. This allows manufacturers to factor in any increase in the raw material cost during the sale of
products, which is then passed on to consumers and vice versa. Most cables & wires’ manufacturers
enter into short contracts with their respective metal suppliers.

Copper: Typically, copper forms ~55-60% of the raw material cost in cables & wires. Hence, cables &
wires are highly sensitive to any fluctuations in the cost of copper.

Aluminum: Aluminum also forms a substantial part in the raw material cost of cables & wires, ranging
from 15-20%. Combined, copper and aluminum almost account for ~75% of the total raw material
cost of cables & wires.

Exhibit 10 : Graph showing Movement in copper prices

Source: MOFSL

Exhibit 11 : Graph showing Movement in Aluminium prices

Source: MOFSL
Equity research Report

Polycab India Ltd.

Project Spring Strategy Unveiled
Focus on Product Innovation and E-beam Technology: Reco : HOLD
Polycab is investing heavily in product innovation and automation to CMP : Rs. 5,900
maintain technological leadership. One key area of focus is the Target Price :Rs. 5,994
adoption of E-beam (electron beam) technology, which enhances the
Potential target : 1.6%
quality and durability of wires and cables. Polycab was among the first
in India to use this technology, initially in niche industrial cables and
now expanding into domestic wires. E-beam-enabled products are Stock data (as on May 12, 2025)
being rolled out across India, starting with the southern region, to meet
Nifty :24,782
rising demand for high-quality, long-life electrical solutions. These
innovations, coupled with increased R&D efforts and automation-led 52 Week H/L (in Rs.) : 7,607/4,555
manufacturing, are positioning Polycab to meet evolving customer Market Cap (in Cr.) : 89,603
expectations and global standards.
Outstanding Shares (Cr.) :30.53
Distribution Network Expansion & Channel Strategy: Dividend Yield (%) : 0.51%
NSE Code : POLYCAB
Polycab continues to strengthen its distribution network across India,
focusing on increasing market penetration, especially in Tier-2 and Tier-
3 towns. During the quarter, the company added over 5,000 new retail Shareholding Pattern( May 12, 2025)
outlets, expanding its total retail touchpoints to more than 2.3 lakh. The
medium-term goal is to reach 3 lakh retail outlets. The company also Promoters 63.04%
emphasized digitizing its distributor-level operations to enhance real-
FIIs 11.11%
time visibility into market demand, improve order tracking, and
increase sales efficiency. This channel deepening strategy is vital for DIIs 10.95%
driving both wires and FMEG (Fast-Moving Electrical Goods) growth. Public 14.90%

Launch of Project Spring: Strategic Transformation Roadmap:

Following the successful completion of Project LEAP, Polycab has

launched its next 5-year strategic roadmap, “Project Spring,” aiming to
Stock Performance (1 Year)
position itself for long-term sustainable growth. Project Spring is
structured around six strategic pillars: reinforcing B2B leadership,
accelerating B2C growth, ramping up international business, driving
innovation and automation, nurturing talent and capabilities, and
integrating ESG practices. These pillars are designed not just to boost
top-line growth but also to build resilience, improve stakeholder value,
and align the company’s vision with India’s “Viksit Bharat 2047” goals.

Nifty Polycab
International Business Expansion and Export Focus:

Polycab is aggressively scaling its international business, which

recorded 62% year-on-year growth in Q3 FY25 and contributed 8.3% to 1M 6M 1Y
total revenue for the quarter. The company has expanded its global Absolute Return 14.2% -5.2% -6.7%
footprint to 81 countries, with the U.S., Middle East, Europe, and
Australia being key contributors. It aims to increase exports to over
10% of its total revenues in the medium term. Polycab is also exploring
alternative go-to-market strategies in the U.S., including distribution
and institutional sales models, and has nearly all required regulatory
approvals for its key export SKUs. The “China+1” global sourcing shift
and growing demand from sectors like data centers, EVs, and
renewables are expected to further fuel this international momentum.
 POLYCAB

Exhibit 12 : Earnings Call

Basis Q3 FY25 Q2 FY25 Views
Financial Revenue increased 21% QoQ Revenue grew 30% YoY, but Q3 showed strong margin
Performance to ₹6,985.8 crore, EBITDA EBITDA margin contracted to recovery and record-high
grew 42% to ₹1,025.4 crore, 11.5%, and PAT stood at profitability after a relatively
and PAT rose to ₹734.4 crore ₹445.2 crore with a margin weaker Q2 margin
with a margin of 10.5%. of 8.1%. performance.

Distribution Retail touchpoints exceeded Distribution-led sales Distribution strength

Network 2.3 lakh, with a medium- contributed nearly 90% of continues to be a growth
term goal to reach 3 lakh; revenue; expansion into engine, with sustained focus
the company focused on smaller markets remained a on both reach and quality of
deepening presence in priority. channel partnerships.
underpenetrated Tier 2 and
Tier 3 markets.

Export Exports contributed 8.3% of Exports accounted for 6.1% The export business is
Performance total revenue, growing 62% of revenue, with sequential gaining momentum with
YoY, with strong traction in improvement mainly driven broader geographic
the Middle East, Africa, and by demand from the Middle diversification and regulatory
Australia. East and Australia. approvals boosting
credibility.

FMEG Business Continued strong growth in The segment grew 18% YoY, FMEG is scaling well in terms
fans, lighting, and though margins remained of volumes, but profitability
switchgears, with the under pressure due to improvement is still a work
premiumization strategy increased A&P spending and in progress due to category-
gaining traction in key urban commodity cost inflation. level headwinds.
markets.

Capex Strategy The company is on track to Capex spend in H1 FY25 Polycab is investing
spend ₹1,000–1,100 crore in stood at ₹570 crore, with aggressively to future-proof
FY25, with Q3 capex focused full-year guidance reaffirmed capacity, especially in high-
on capacity expansion for at ₹1,000–1,100 crore. growth categories, while
wires, cables, and the maintaining capex discipline.
upcoming EHV facility.

Competitive Stability in commodity prices The wires segment was The company is maintaining
Landscape & allowed margin recovery; impacted by copper price pricing discipline in cables,
Pricing Strategy cables saw no major pricing volatility and intense but wires remain vulnerable
disruption, though wires competition; cables to input cost movements and
remained highly price- remained relatively stable. pricing pressures.
sensitive.
 POLYCAB

About the company

Polycab India Limited is primarily engaged in the manufacturing and sale of Wires and Cables. This
segment is their main activity and accounted for 89% of their turnover in FY 2023-24 and FY 2022-23.
Polycab is described as the largest manufacturer of Wires and Cables in India and is considered the
market leader in the W&C industry.
The company is also a prominent and fast-growing player in the Fast-Moving Electrical Goods (FMEG)
space. The FMEG segment accounted for 6% of their turnover in FY 2023-24 and FY 2022-23. Products
in this segment include fans, LED lighting and luminaires, switches, switchgears, solar products, water
heaters, conduits, pumps, and domestic appliances. They aim to attain market leadership across all
FMEG product categories by enhancing production capacities and diversifying their range, with a
strategic emphasis on premium offerings. Polycab plans to foray into the B2B market for lighting
solutions, expanding its total addressable market beyond the current B2C focus.
Polycab also has an "Others" segment, which primarily comprises their Engineering, Procurement, and
Construction (EPC) business. The EPC business involves the design, engineering, supply of materials,
survey, execution, and commissioning of projects, such as power distribution and rural electrification.
This segment accounted for 2% of total sales in FY23 and contributed revenue of ₹9.6 billion in FY24,
contributing in single digits to the consolidated top-line.

Exhibit 13: Product Mix Exhibit 14: Geographical Revenue Mix

Product Mix Geographical Revenue Mix

11% 5%

8%

81%
95%

Wires & Cables FMEG Others Domestic International

 POLYCAB

Backward Integration
Polycab India Limited continues to strengthen its competitive edge through deep backward integration,
particularly in its core Wires & Cables (W&C) business and increasingly in the Fast-Moving Electrical
Goods (FMEG) segment.
Strategic Role of Backward Integration
Backward integration is a key differentiator in Polycab’s strategy, playing a central role in driving
operational efficiency, maintaining strict quality control, and ensuring product consistency. By
internalizing critical parts of the value chain, the company enhances its control over input materials,
reduces dependency on external suppliers, and improves supply chain visibility.
Wires & Cables (W&C) – Fully Integrated
In its flagship W&C segment, Polycab has achieved near-complete backward integration. Over the past
decade, significant investments have been made in aluminium rod plants and PVC compound
manufacturing units. As a result, nearly 100% of sales in this segment come from products
manufactured in-house, enabling superior quality and cost efficiencies.
FMEG Segment – Replicating the Model
Polycab is now applying the same integration playbook to its growing FMEG business. Key initiatives
include:
• Setting up an in-house switch manufacturing facility in Daman, boosting product availability and
control.
• In the switchgear segment, all critical sheet metal and plastic components are produced
internally, ensuring uniform quality.
• With a move towards full in-house manufacturing of FMEG products, the company aims to reduce
go-to-market timelines, improve margins, and benefit from economies of scale.
Integration of Packaging Supply Chain
To further reinforce control over its operations, Polycab has incorporated Steel Matrix Private Limited,
a wholly-owned subsidiary aimed at securing reliable, high-quality packing materials. While it hasn't
commenced operations yet, this step aligns with the company’s broader backward integration goals.
Robust Manufacturing Network
Polycab operates 28 manufacturing units across India as of FY24, forming the backbone of its
integrated production strategy.
In summary, backward integration remains a cornerstone of Polycab’s operational strategy—fully
implemented in W&C and steadily expanding in FMEG—providing the company with greater quality
control, operational efficiency, and long-term profitability.
 POLYCAB

Capacity Expansion
Polycab India Limited is taking a bold leap in its growth journey with a sharp focus on capital
expenditure (capex)—a strategic priority and a key element of its long-term vision.
A Step-Change in Investment Philosophy
Until FY2023, Polycab maintained an average annual capex of ₹3–4 billion. That changed
dramatically with the launch of Project Spring, where the company now plans to invest in five years
what it previously did over an entire decade.
Recent Capex Momentum
• FY23 capex: ₹4,584 million
• FY24 capex: ₹8,580 million—nearly double previous levels
• 9M FY25 capex: ₹8.3 billion, with steady deployment across quarters
The company now expects to maintain an annual capex of ₹10–12 billion through FY25 to FY27.

Project Spring: The Next 5-Year Vision

Aiming to invest ₹60–80 billion through FY26–FY30, Project Spring is designed to scale capacity in
line with rising demand. This shift is driven by the need to stay ahead of the curve—ensuring
readiness to serve high-growth sectors like infrastructure, renewables, defence, EVs, data centres,
and telecom.
Capex Allocation Highlights
• ~75% of the investment is directed toward the Wires & Cables (W&C) business
• ~25% supports FMEG expansion and brownfield upgrades
Key projects include:
A new EHV cable plant in Halol with ₹6–7 billion outlay, targeting production by FY26
An in-house switch manufacturing facility in Daman
Ongoing expansion across plant locations, warehouses, and a new head office
Significant CWIP tied to capacity building in W&C and FMEG segments

Strategic Impact
These investments are expected to deliver asset turns of 4x–5x, strengthen market leadership, and
build scalable infrastructure to support growth that outpaces the market by over 1.5x. The EHV
plant alone opens up a ₹40–50 billion domestic opportunity, with meaningful potential in exports as
well.
Polycab’s evolving capex strategy reflects its confidence in the future and commitment to becoming
a dominant force across segments by building capacity before demand peaks.
 POLYCAB

Distribution Network
Polycab India has built a vast and reliable distribution network that spans across the country, supported
by over 3,800 dealers and distributors and reaching more than 205,000 retail outlets. Its FMEG (Fast-
Moving Electrical Goods) segment alone is backed by 2,900+ partners, ensuring extensive product
availability and strong market presence. Internationally, Polycab has expanded exports to 81 countries,
up from 70 last year.

This far-reaching ecosystem is not just about coverage—it’s a key driver of performance. With most
orders delivered within 24 hours, Polycab ensures speed, efficiency, and deep market penetration.
Channel partners double up as frontline brand ambassadors, providing real-time feedback and powering
sales.

Under the strategic leadership of Mr. Inder T. Jaisinghani, Polycab has evolved from a B2B player to a
distribution-led powerhouse, with over 80% of business now channeled through its network. In FY23,
83% of consolidated sales came via dealers and distributors, further boosted by initiatives like channel
financing for smoother operations.

The company is aggressively targeting underpenetrated districts (122 in FY23) and has restructured its
FMEG distribution model to improve efficiency without increasing headcount. It’s also applying its
winning model globally, especially in the U.S., by partnering with distributors and Manufacturer
Representatives (MRs).

Cross-selling is another strategic lever—combining products like wires with switches, fans with
lighting—to maximize share of customer wallet through existing channels. Direct-to-consumer (D2C)
efforts are expanding too, with tailored GTM strategies for untapped markets and greater engagement
at the retailer level.

On the digital front, Polycab has integrated Salesforce-based platforms, real-time dashboards, and
order management tools. Platforms like Polycab Experts and P Connect connect over 100,000
electricians and retailers, streamlining transactions and strengthening relationships.

A structured approach to channel partner engagement—through feedback loops, physical events, and
dedicated teams—alongside a clear Supplier Code of Conduct, ensures ethical, tech-enabled, and
performance-driven collaboration.

In essence, Polycab’s distribution strength is not just a backbone—it’s a growth engine that propels
its leadership in both Indian and global markets.
 POLYCAB

Initiatives to strengthen its brand

Polycab India Limited is undergoing a dynamic brand transformation that aligns seamlessly with its long-
term growth vision under Project LEAP and Project Spring. At the heart of this shift is a sharpened focus
on visibility, customer loyalty, and a refreshed identity that signals innovation, quality, and trust.

The launch of its new brand motto—“Ideas. Connected.”—marks a pivotal step in Polycab’s evolution,
reflecting a commitment to safety, sustainability, and customer-first thinking. This repositioning is
backed by a significant 60% increase in advertising and promotion (A&P) spend in FY24 and strategic
collaborations with top agencies like Ogilvy and Interbrand.

Polycab is also making waves through its high-profile association with the International Cricket Council
(ICC), and impactful campaigns like “Cheer India Ke Liye” and #ViewBadalDe, further deepening
customer engagement.

On the ground, the Influencer Management Programme is setting new industry standards by
empowering over 100 managers across 40 cities to connect with key stakeholders—electricians,
architects, and designers—through training, feedback, and loyalty initiatives.

Its expanding distribution network, highlighted by formats like Polycab Galleria, Arena, and Shoppe, is
enhancing both visibility and accessibility. This successful domestic model is now making inroads into
global markets, starting with the USA.

Digitalisation is another pillar of Polycab’s strategy. With loyalty apps, a strong e-commerce presence,
and advanced data analytics, the company is building a robust digital ecosystem that sharpens market
insights and strengthens customer touchpoints.

Product innovation remains a core focus, supported by sustained R&D investment and in-house
manufacturing. Launches like Etira, Primma, and Maxima+ wires, along with Etira switches, and multiple
international certifications, underscore Polycab’s commitment to quality and performance.
Under Project LEAP, customer-centricity is being taken to new heights—with localized strategies,
streamlined service systems, and an emphasis on long-term trust.

Polycab’s brand journey is also deeply rooted in ethical, sustainable, and governance-led practices.
These values aren’t just checkboxes—they’re the foundation of its ESG strategy and reputation.

In short, Polycab’s brand transformation isn’t just about being seen—it’s about being remembered for
what truly matters: innovation, reliability, and deep customer connection.
 POLYCAB

Focus on Research & Development

Polycab India Limited places strong strategic emphasis on Research and Development (R&D), treating it
not as a support function but as a critical growth driver. R&D is closely tied to the company’s purpose—
“Connecting all to a brighter future”—and supports its vision of continuous innovation and value
creation.
Polycab has embedded R&D deeply into its transformation roadmaps—Project LEAP, which focuses on
new product development, and Project Spring, which elevates R&D investments for innovation. In FY24
alone, the company invested ₹260 million in R&D, with significant allocations towards environmentally
sustainable solutions and socially impactful technologies.
The company has built a strong ecosystem of R&D facilities across Roorkee, Halol, and Bengaluru. Its
Polymer R&D Centre, recognised by DSIR, is dedicated to creating new compounds for safer and more
sustainable Wires & Cables. The NABL-certified lab and the Uniglobus R&D centre (for the FMEG
segment) further showcase the breadth of their innovation infrastructure.
What sets Polycab apart is how aligned their R&D is with market trends and customer needs. In Wires &
Cables, the focus lies on green, lead-free wires, electron-beam irradiated cables, and solutions for
sectors like EVs, defence, and renewables. In FMEG, they’re driving premiumisation with products like
BLDC fans, IoT-enabled smart devices, and new-age lighting like the Infinity Lamp.
They’re also integrating AI, Industrial IoT, and automation into both R&D and manufacturing. A
standout achievement is the zero market sample failure rate with BIS, underlining their commitment to
quality. The benefits extend beyond innovation—Polycab has seen 37% cost savings in socket designs
and achieved import substitution by developing complex cables in-house.
The outcomes speak volumes. Products like Etira, Primma, and Green Wire have already made a strong
impact. And with 78 IPRs registered and 424 more filed in FY24, Polycab continues to solidify its
position as a tech-led, forward-thinking company.
As part of its future roadmap, Polycab is set to enhance certification programmes and ramp up R&D for
smart technologies, sustainability, and high-growth sectors like renewables. R&D isn’t just a function at
Polycab—it’s a strategic engine powering long-term leadership and customer value.
 POLYCAB

SWOT Analysis Strengths:

• Polycab is the as a leading player and one of the largest
Manufacturer of Wires and Cables in India.

• Polycab has strong backward integration.

• The company has a unique advantage in its raw material

procurement contracts which helps negate volatility in
commodity prices and maintain margins within the
guided range.

Weakness:
• A significant business transition in the international
segment, pivoting to a distribution model, is time-
consuming and can slow growth during the transition
phase.

• The transition in the FMEG segment may lead to

temporary stagnation in its performance during FY 2024-
25.
Opportunities:
• The W&C industry is poised for accelerated growth
driven by factors such as expansion and modernisation
of power transmission and distribution infrastructure,
upgradation and expansion of the railway network,
increased investments in metro railroads, smart grid
initiatives, and development of smart cities.

• Opportunities exist in sunrise sectors like Renewables,

Defence, and Electric Vehicles. Polycab is developing
cables for these sectors and is in the process of
developing DC charging cables to leverage the
burgeoning electrical markets in automotive and EV.

• Rising demand in both domestic and export markets

creates a need for capacity enhancement initiatives to
ensure supply continuity and scalability.

Threats:
• Fluctuations in commodity prices.

• Disruption in supply chain would lead to disruption in

operations.

• The industry is facing intense competition from both

organized and unorganized players..
 POLYCAB

Story in charts

Exhibit 15: Ad spending as a % to sales Exhibit 16 : Large retail touch points

2500 2263 1.4 2,50,000

1.2 2,05,000 2,05,000 2,05,000
2000
2,00,000
1.0
1500 1244 0.8
1,50,000
1000 823 0.6
0.4 1,00,000
500
0.2
50,000
0 0.0
FY22 FY23 FY24
0
Ad spend (INR M) as a % to sales FY22 FY23 FY24

Exhibit 17 : Dealers count declined Exhibit 18: Domestic vs International Sales

5,000 4,600
4,300 5%
4,500
4,000 3,790
3,500
3,000
2,500
2,000
1,500 95%
1,000
500
0
FY22 FY23 FY24 Domestic International

Exhibit 19 : Product Mix Exhibit 20 : Cumulative capex of cables & wires

segment over FY14-23 (INR m)
25,000 22,265

11% 20,000
8%
15,000

10,000
5,646 5,344
81% 4,518
5,000 2,587

0
Polycab KEI RR Kabel Finolex Universal
Wires & Cables FMEG Others Cables
 POLYCAB

Story in charts

Exhibit 21 : Market share in domestic market Exhibit 22: Total Capex (INR B)

28% 12
27%
27% 9.6
10
27% 8.6
26%
26% 8
26%
25% 6
4.6
25% 24% 4
24%
24% 2
23%
23% 0
FY23 FY24 FY25 FY23 FY24 FY25

Exhibit 23 : FMEG segment reached break even Exhibit 24: FMEG segment Revenue & Growth

20,000 35%
EBIT % 30%
5 15,000 25%
0.50 20%
0 10,000 15%
FY23 FY24 FY25 10%
-2.3 5,000 5%
-5
0%
0 -5%
-10 FY23 FY24 FY25

-15 -12.9 Revenue (INR M) YoY (%)

Exhibit 25 : Wires & Cables Revenue & Growth Exhibit 26 : Wires & Cables EBIT and Margin

2,00,000 30% 30,000 15%

25% 25,000 15%

1,50,000
20% 20,000 14%

1,00,000 15% 15,000 14%

10% 10,000 13%

50,000
5% 5,000 13%

0 0% 0 12%
FY23 FY24 FY25 FY23 FY24 FY25

Revenue (INR M) YoY (%) EBIT (INR M) Margin %

 POLYCAB

Story in charts

Exhibit 27 : Sales & Growth Exhibit 28 : Gross Profit & Margin (%)

25,000 22,408 30% 7,000 6,383 29%

25% 6,000 29%

20,000 18,039 4,812
5,000 28%
14,108 20%
15,000 3,767
4,000 28%
15%
10,000 3,000 27%
10%
2,000 27%
5,000 5% 1,000 26%
0 0% 0 26%
FY23 FY24 FY25 FY23 FY24 FY25

Sales (INR Cr) YoY (%) Gross Profit (INR Cr) Margin (%)

Exhibit 29 : EBITDA & EBITDA Margins (%) Exhibit 30 : PAT & Margins (%)

3,500 14% 2,500 11%

2,960 2,046
3,000 2,492 14% 1,803
2,000
2,500 14% 10%
1,843 1,500 1,283
2,000 13%
10%
1,500 13% 1,000
1,000 13% 9%
500
500 13%
0 13% 0 9%
FY23 FY24 FY25 FY23 FY24 FY25

EBITDA Margin (%) PAT Margin (%)

Exhibit 31: ROE & ROCE

Exhibit 32 : PE
23% 30% 50.00
22% 42.20
22% 29% 37.85
40.00 33.62
21%
21% 28%
30.00
20% 19% 27%
20.00
19% 26%

18% 25% 10.00

17% 24% 0.00

FY23 FY24 FY25 FY23 FY24 FY25

ROE ROCE PE
 POLYCAB

Financials
Exhibit 33 : Consolidated Profit & Loss Account
Particulars Q4 FY25 % Q3 FY25 % Q4 FY24 % FY25 % FY24 %
Revenue from Operations 69,858 100.00% 52,261 100.00% 55,919 100.00% 2,24,083 100.00% 1,80,394 100.00%
Cost of Goods Sold 52,053 74.50% 38,807 74.30% 41,792 74.70% 1,68,300 75.10% 1,32,803 73.60%
Contribution (A) 17,805 25.50% 13,453 25.70% 14,127 25.30% 55,783 24.90% 47,591 26.40%
Employee Cost 2,036 2.90% 1,989 3.80% 1,696 3.00% 7,367 3.30% 6,095 3.40%
Other Operating Expenses 5,515 7.90% 4,265 8.20% 4,816 8.60% 18,813 8.40% 16,578 9.20%
Total Operating Expenses (B) 7,551 10.80% 6,254 12.00% 6,512 11.60% 26,180 11.70% 22,673 12.60%
EBITDA (A - B) 10,254 14.70% 7,199 13.80% 7,615 13.60% 29,602 13.20% 24,918 13.80%
Other Income 481 0.70% 250 0.50% 538 1.00% 2,076 0.90% 2,209 1.20%
Depreciation 804 1.20% 786 1.50% 657 1.20% 2,981 1.30% 2,450 1.40%
Finance Cost 325 0.50% 498 1.00% 244 0.40% 1,689 0.80% 1,083 0.60%
PBT 9,606 13.80% 6,166 11.80% 7,253 13.00% 27,008 12.10% 23,593 13.10%
Income Tax 2,262 3.20% 1,522 2.90% 1,718 3.10% 6,553 2.90% 5,564 3.10%
PAT 7,344 10.50% 4,643 8.90% 5,535 9.90% 20,455 9.10% 18,029 10.00%

Exhibit 34: Consolidated Balance Sheet

Particulars Mar-25 Dec-24 Mar-24 Particulars Mar-25 Dec-24 Mar-24
Assets Equity and Liabilities
Non-current Assets Shareholder’s Funds
Fixed Assets 37,193 35,544 29,160 Share Capital 1,504 1,504 1,502
Non-current Deposits 465 103 58 Reserves and Surplus 96,746 89,250 80,369
Other Non-current Assets 6,879 6,654 4,432 Total Shareholder’s Funds 98,250 90,754 81,871
Total Non-current Assets 44,537 42,302 33,649 Minority Interest 818 741 562

Current Assets Non-current Liabilities

Inventories 36,613 43,784 36,751 Borrowings 419 315 226
Trade Receivables 25,963 23,617 20,471 Others - Non-current Liabilities 3,139 3,626 2,188
Investments 17,490 11,744 18,224 Total Non-current Liabilities 3,558 3,942 2,414
Cash and Bank Balances 7,706 6,612 4,024
Others - Current Assets 5,418 7,657 7,670 Current Liabilities
Total Current Assets 93,190 93,413 87,140 Short-term Borrowings 671 1,010 672
Acceptances 13,062 19,880 18,620
Trade Payables 14,295 13,159 10,014
Others - Current Liabilities 7,073 6,229 6,636
Total Current Liabilities 35,101 40,278 35,941

Total Assets 1,37,727 1,35,714 1,20,789 Total Equity and Liabilities 1,37,727 1,35,714 1,20,789
 POLYCAB

Valuations & Views

Exhibit 35: Valuation
Amount in crores
Comparable Company Valuation

Market Data Financials Valuations

Share Share Equity Enterprise Net

Company Price Outstanding Value Net Debt Value RevenueEBITDA Income EV/Revenue EV/EBITDA P/E

Polycab 5,900 15.04 88,752 -569 88,183 22,408 2,960 2,046 3.9x 29.8x 43.4x
KEI 3,260 9.56 31,150 -1,698 29,452 9,736 991 696 3.0x 29.7x 44.8x
RR Kabels 1,300 11.31 14,705 63 14,768 7,618 486 312 1.9x 30.4x 47.1x

High 3.9x 29.8x 44.8x

75th Percentile 3.7x 29.8x 44.4x

Average 3.5x 29.8x 44.1x
Median 3.5x 29.8x 44.1x

25th Percentile 3.3x 29.7x 43.7x

Low 3.0x 29.7x 43.4x

Polycab Comparable Valuation P/E

Implied Enterprise Value 89,592

Net Debt -569
Implied Market Value 90,161
Shares Outstanding 15.04

Implied Value per Share 5,994

Undervalue
d

Valuation Methodology:
A Comparable Company Analysis (CCA) was conducted using three peer companies in the electrical
and cable manufacturing industry: Polycab, KEI, and RR Kabels. Key valuation multiples considered
were EV/Revenue, EV/EBITDA, and P/E Ratio, with P/E used as the primary metric for deriving the
implied valuation of Ploycab.

Based on peer comparison using the P/E multiple, Polycab appears undervalued with an implied
value per share of ₹5,994, slightly above the market price of ₹5,900. This marginal undervaluation
suggests room for upside, assuming fundamentals align with comparable companies in terms of
profitability and growth potential.
Recommendation: Accumulate/Hold, depending on broader market conditions and internal
performance metrics.
Equity research Report

KEI Industries Ltd.

Capacity expansion to drive growth
Retail Sales Strengthen Through Dealer Expansion: : BUY
Reco
KEI continued to strengthen its retail presence during Q3 FY25, with CMP : Rs. 1,300
B2C (retail) sales contributing 51% to total revenues, up from 46% in Target Price :Rs. 1,667
the same quarter last year. The company attributed this growth to
consistent efforts in expanding dealer and distributor networks, Potential target : 28%
enhancing influencer engagement, and deepening its geographic
presence across India. As of December 31, 2024, KEI had around 2,060 Stock data (as on May 12, 2025)
active dealers. Management reaffirmed its commitment to maintaining
a retail growth rate of around 20–25% annually through increased Nifty :24,782
manpower, wider product reach, and strategic sales initiatives. 52 Week H/L (in Rs.) : 5,040/2,424

Capex Focused on Capacity Growth: Market Cap (in Cr.) : 33,443

Outstanding Shares (Cr.) :9.55
KEI is investing aggressively to boost production capacity. It incurred a
Dividend Yield (%) : 0.12%
capex of ₹426 crore in the first nine months of FY25 across plants in
Sanand, Chinchpada, Bhiwadi, and Pathredi. Brownfield expansions at NSE Code : KEI
Chinchpada and Pathredi have been completed, and these are
expected to add 16–17% volume growth this year. Additionally, a major Shareholding Pattern( May 12, 2025)
greenfield capex project is underway at Sanand for LT, HT, and EHV
cables. Phase 1 is scheduled to start production by end of Q1 FY26, and
the company plans to spend ₹700 crore more next year to complete Promoters 35.01%
the project. This new capacity is expected to significantly scale KEI’s FIIs 25.83%
production volumes and support its long-term growth vision. DIIs 23.11%
Public 15.65%
Exports Accelerate with Global Expansion Plans:

Exports remain a strong focus area for KEI. Despite a decline in EPC- Stock Performance (1 Year)
related exports (such as the completed Gambia project), the core wires
and cables export segment grew by approximately 30% YoY. The
company expects 30–35% export growth next year, with the U.S. and
Australia emerging as key growth markets, alongside steady demand
from the Middle East and Africa. KEI aims to scale exports to 15–17% of
total revenue over the next 2–3 years. To support this, the company is Nifty KEI
placing new teams across geographies and equipping its new Sanand
facility to meet international standards, especially for EHV and HVDC
cables
1M 6M 1Y
Vision 2030 Targets ₹25,000 Cr Revenue: Absolute Return 27.8% -5.8% -13.6%

KEI outlined a clear long-term roadmap aiming to achieve

₹25,000 crore in turnover by FY30. This growth will be driven by
continuous capacity additions, expanding global footprint,
strengthening retail presence, and broadening product offerings.
The management emphasized that all building blocks are in
place—land has already been acquired in Baroda for the next
wave of expansion, QIP funds have been raised for capex and
debt repayment, and internal teams are being bolstered across
retail and export verticals. With a targeted CAGR of 20% and
planned EBITDA margin expansion to 12.5% by FY28, KEI is
positioning itself as a comprehensive and globally competitive
cables and wires player.
 KEI

Exhibit 36 : Earnings Call

Basis Q3 FY25 Q2 FY25 Views
Financial Revenue grew 20% YoY to Revenue grew 17% YoY to Q3 showed stronger
Performance ₹2,737 Cr, EBITDA margin ₹2,280 Cr, EBITDA margin was profitability and improved
improved to 10.76%, and PAT 10.42%, and PAT was ₹154.8 Cr. margins after a relatively softer
stood at ₹189.3 Cr. Q2; performance in line with
full-year guidance.

Retail Retail sales contributed 51% of Retail sales contributed 55% of Both quarters reflect solid B2C
Channel total revenue with 2,060 active revenue with 2,038 active traction; however, Q3 saw a
Growth dealers, supported by strong dealers; segment grew 36% YoY. slightly lower contribution as
B2C momentum. institutional sales recovered.

Exports Export revenue grew ~30% YoY Export revenue declined slightly Q3 witnessed a strong export
Performance in wires and cables; focus YoY to ₹241 Cr due to base recovery driven by core cables;
continued on scaling U.S., effect and order dispatch momentum is expected to
Australia, and Middle East delays. continue with new capacity and
markets. approvals.

EHV EHV sales remained muted due EHV cable sales dropped to ₹73 Both quarters faced EHV
Segment to execution delays; capacity Cr from ₹169 Cr YoY; affected softness due to external factors;
Performance was utilized for HT cables to by project clearances and ROW management expects
maintain plant efficiency. issues. normalization over full-year.

Capex and Brownfield expansion fully Capex of ₹312 Cr incurred in Execution is progressing as per
Capacity operational; Sanand greenfield H1FY25; Sanand project plan, with significant capacity
Expansion project on track with ₹1,100 Cr spending at ₹169 Cr in H1; coming online in FY26 to
FY25 capex guidance. phase-wise completion planned. support 17%+ growth targets.

Future Management reiterated 17% Similar 17% growth outlook Long-term guidance remains
Strategy & revenue CAGR target till FY30, maintained; Sanand capacity consistent; company is
Outlook with EBITDA margins guided expected to drive next leg of balancing growth and financial
between 10.5–11%. expansion. prudence through proactive
capex and fundraising.
KEI

About the company

KEI Industries Limited is engaged in the manufacturing and sale of a comprehensive range of wires
and cables. It is recognized as one of the leading and largest organized players in India’s wire and
cable industry and ranks among the top three manufacturers in the organized segment.
The company’s extensive product portfolio includes Extra High Voltage (EHV) cables (up to 400kV),
High Tension (HT) cables, Low Tension (LT) cables, Control cables, Instrumentation cables, Marine &
Offshore cables, Solar cables, Stainless Steel Wires (SSW), Winding Wires (WW), House Wires (HW),
Single Core / Multicore Flexible cables, Rubber (Elastomeric) cables, Fire Survival / Fire Resistant
cables, Communication cables, Thermocouple cables, ESP cables, MVCC cables, EV cables, Flat
cables, and Specialty cables.
Extra High Voltage (EHV) Cables (up to 400kV) – KEI is among the few Indian manufacturers capable
of producing EHV cables above 220kV and is also part of a select group of global companies
manufacturing EHV cables up to 400kV.
Beyond manufacturing, KEI also provides Engineering, Procurement, and Construction (EPC) services
for utility projects requiring complex cabling infrastructure. These turnkey solutions include design,
engineering, supply, erection, testing, and commissioning of transmission & distribution systems and
substation projects (GIS and AIS), including both overhead and underground installations. In FY
2023-24, the EPC segment accounted for 6.94% of the total turnover (excluding cables).
The company’s business is well-diversified across products, clientele, and geographical presence. It
serves both retail (B2C – household wires, LT and HT cables) and institutional (B2B – EHV, HT and LT
cables, stainless steel wires, and EPC projects) markets. KEI caters to a wide spectrum of industries,
including Power, Infrastructure, Real Estate, Oil & Gas, Refineries, Defence, Chemicals, Metals,
Manufacturing, Pharmaceuticals, IT, Renewables, Cement, Fertilizer, Consumer Durables, Data
Centers, Steel, Roads & Highways, Textiles, Railways, Metro Rail, Automobiles, Telecommunications,
and Electric Vehicles.
KEI

Distribution Network
KEI Industries Limited places significant strategic importance on its distribution network, particularly
to strengthen its rapidly growing retail business. The company has built a vast and dynamic
distribution ecosystem that forms a critical pillar of its overall growth.
Size and Reach:
As of March 31, 2025, KEI had approximately 2,082 active working dealers, up from 1,910 in FY
2022-23 and 1,990 as of March 31, 2024. The network spans metros, Tier 1, and Tier 2 cities,
reinforcing the company’s strong Pan-India retail presence. KEI operates 24 depots across the
country and maintains 36 marketing offices. Additionally, a total of 60 national offices, project
offices, and depots were reported as of FY 2023-24 (compared to 59 in FY 2022-23), demonstrating a
growing national footprint that covers all four regions—North, South, East, and West India.
Role and Importance:
The distribution network serves as the company’s front-end for the retail segment, enabling it to
reach a wider customer base and ensure timely product availability. Strengthening this network is
key to increasing the retail contribution to overall revenues. It also plays a crucial role in optimizing
receivable cycles and enhancing cash flow.
Strategy and Approach:
KEI follows a well-defined three-pronged approach to enhance its distribution strength:
1. Active engagement with electricians and influencers through plant visits, meets, and a
dedicated call center to build grassroots connections.
2. Expansion of retailers under each distributor to widen last-mile reach.
3. Growth and optimization of the distributor base by onboarding strong partners and replacing
underperforming ones.
Rather than focusing solely on growing numbers, the company prioritizes improving dealer
performance. This is supported by strategic stocking points for faster delivery, deployment of
focused marketing teams, business development teams, and efforts to secure brand approvals. KEI
also leverages digital tools like KEI Connect, integrates Salesforce platforms, and strengthens market
intelligence to streamline operations and deepen engagement with channel partners.
To foster dealer loyalty and boost motivation, the company offers performance-based incentives and
maintains year-round engagement with retailers and electricians. Brand visibility is further enhanced
through targeted marketing campaigns, including television ads, digital outreach, and public
relations efforts.
KEI

Impact on Sales:
Sales through the dealer/distribution network have seen consistent growth:
• ₹3,030 crore in FY 2022-23 (up 31%)
• ₹3,770 crore in FY 2023-24 (up 19%)
• ₹5,088 crore in FY 2024-25 (up 34.94% YoY)
The retail business contribution to overall sales has increased steadily—from 40% in FY 2021-22 to
44% in FY 2022-23, 47% in FY 2023-24, and 52.26% in FY 2024-25 (having reached 53% in 9M FY25).
This surpasses the company’s earlier near-term target of achieving a 50% retail share. Currently,
approximately 50% of distribution channel sales consist of wires and the remaining 50% of cables.
In essence, KEI’s robust and evolving distribution network—comprising depots, dealers, distributors,
retailers, marketing offices, and engaged electricians—has become the backbone of its retail
success. By continually investing in and optimizing this network, the company ensures scalable
growth, stronger brand equity, and enhanced operational agility.
KEI

Capacity Expansion
KEI Industries Limited is aggressively scaling up its manufacturing capacity in alignment with its
ambitious growth roadmap. This strategy is being executed through a combination of brownfield
expansions—enhancing capacity at existing plants—and large-scale greenfield projects aimed at
establishing new state-of-the-art facilities.
1. Backward Integration (Completed/Existing):
The company has implemented backward integration for PVC compound production, operating two
dedicated plants located in Harchandpur, Rajasthan, and Dapada, Dadra & Nagar Haveli and Daman
& Diu. This initiative has improved cost efficiency and quality, supporting the company’s broader
manufacturing capabilities.
2. Brownfield Expansions (Completed/Ongoing):
Significant investments are being made to enhance existing facilities:
• The Chinchpada unit saw an investment of ₹40–50 crore, completed by September 2023,
adding ₹900–1,000 crore per annum in LT and House Wire capacity.
• An ongoing project at Pathredi is set to boost LT power cable capacity by ₹800–900 crore
annually, with commercial operations expected in Q2 FY 2024-25. This expansion involves an
investment of around ₹125 crore.
• Additional brownfield capex of ₹50–60 crore is planned at Chinchpada and Pathredi in Q2 FY
2024-25.
• Capacity upgrades have been undertaken across Bhiwadi, Rakholi, Chopanki, Pathredi, and
Chinchpada to enhance production of LT cables, Winding Wires, Stainless Steel Wires, Rubber
Cables, and Control/Instrumentation Cables.
• The completed brownfield expansions at Chinchpada and Pathredi 2 are expected to support a
volume growth of 16–17% in FY 2024-25.
3. Greenfield Expansion – Sanand, Gujarat:
A major manufacturing facility is under development in Sanand, Ahmedabad, spread across 70–71
acres acquired from GIDC.
• Total investment is estimated at ₹1,700–1,800 crore.
• The facility will focus on LT, HT, and EHV cables, with HVDC cable capability included in the final
phase by March 2026. It will not produce wires.
• Revenue potential is projected at around ₹5,000 crore, including ₹1,200–1,300 crore from EHV,
₹1,500 crore from HT, and the remainder from LT cables. Due to the capital-intensive nature of
EHV infrastructure, the asset turnover for this facility is around 2.5x.
• Construction began in FY 2023-24, with commercial production (LT and HT cables) expected to
start by the end of FY 2024-25 or Q1 FY 2025-26.
• Funding for the project is largely supported by the ₹2,000 crore raised through a QIP in
November 2024.
KEI

• Capital expenditure for FY 2023-24 was ₹400 crore, with a further ₹900–1,000 crore planned in
FY 2024-25 and another ₹500–600 crore in FY 2025-26. The total CapEx outlay, including other
projects, stands at ₹1,100+ crore for FY25 and ₹600–700 crore for FY26.
• Once fully operational by FY 2025-26, Sanand is expected to add approximately ₹900 crore in
incremental revenue in its first year of full-scale contribution.
• This facility plays a crucial role in supporting KEI’s 15–16% CAGR target over the next 3–4 years
and will enhance its ability to scale exports—particularly for EHV cables—by enabling longer
drum lengths.
4. Future Greenfield Expansion – Baroda, Gujarat:
Post-Sanand, the company is preparing for its next greenfield project in Baroda.
• Around 60 acres of land has already been acquired for this facility.
• The plant will focus on LT and HT cables.
• Investment is projected at ₹700–800 crore annually for two years, after the Sanand facility is
completed.
• The plant is expected to add ₹5,000–6,000 crore in annual capacity and is likely to commence
operations by FY 2028-29.
• This expansion is part of KEI’s broader goal of achieving ₹25,000 crore in turnover by 2030.
Through a mix of near-term brownfield upgrades and long-term greenfield investments, KEI
Industries is methodically expanding its manufacturing footprint. These efforts are sharply focused
on increasing capacity for high-demand and high-value products like LT, HT, and EHV cables, while
also reinforcing its position in both domestic and global markets.
KEI

Strategic Initiatives taken by company

KEI Industries Limited has undertaken a wide range of strategic initiatives to strengthen its brand,
recognizing brand development as a key driver of growth—especially in its retail segment. These
efforts span across advertising, sports sponsorships, digitalization, channel partner engagement, and
product innovation.
1. Brand Recognition and Protection
KEI has established itself as a prominent Superbrand, holding this status during 2011–2016 and again
from 2019–2024. Its trademarks—including the wordmark “KEI” and the associated logo—are
recognized as “Well-Known Trademarks” under the Trade Marks Act, 1999. As of March 31, 2024, KEI
held 37 registered trademarks, with 19 additional applications pending, further securing its brand
identity.

2. Advertising and Publicity

The company invests consistently in high-impact marketing campaigns. Branding and advertising
spends totalled ₹405 million (₹40.5 crore) in FY 2023–24, accounting for approximately 0.50% of
revenue.
• KEI runs multilingual television ads in 13 regional languages using a hyper-local strategy.
• High-profile campaigns during events like the Indian Premier League (IPL) prominently promote
house wires and support retail channel partners.
• Its latest ad campaign features Royal Challengers Bangalore (RCB) players introducing Conflame
Green+ wires, emphasizing their safety and eco-friendly attributes.

3. Sports Sponsorships
KEI has leveraged sports partnerships as a key brand visibility tool:
• It has been associated with the IPL for 7–8 consecutive years.
• The company is the principal and sustainability partner of the RCB team, strengthening brand
recall and consumer engagement.
• Interactive digital content such as quizzes and contests during IPL seasons boosts fan
engagement.
• KEI is also expanding its presence into other sports like kabaddi and football. It had previous
associations with teams like Rajasthan Royals.
KEI
4. Outdoor and Retail Branding
KEI runs impactful outdoor campaigns across India:
• Branding on buses, auto-rickshaws, hoardings, and retail installations.
• Campaigns at high-footfall locations like pilgrimage sites, airports, and metros.
• Innovative efforts like Shikara boat branding, Chardham Yatra, metro branding (Kolkata), train
branding (Shiv Shakti Express), and the Ram Mandir campaign.
• Extensive festive branding across 12,500+ retail outlets enhances visibility at the ground level.

5. Engagement with Channel Partners and Influencers

The company recognizes its dealer network and electricians as the frontline of brand delivery.
• KEI follows a three-way strategy: increasing the number of distributors, expanding retailers
under each distributor, and engaging with electricians.
• Year-round engagement includes electrician loyalty programs, plant visits, and health camps.
• Updates and support are provided via WhatsApp, a dedicated call center, and business
development teams focused on project approvals and dealer performance.
• Dealers and distributors achieving targets are rewarded through incentives, strengthening their
loyalty and alignment with the brand.

6. Digitalization and CRM Tools

KEI is actively digitalizing its sales and marketing ecosystem:
• Platforms like KEI Connect and KEI Supply Beam enable seamless interaction with stakeholders.
• Salesforce CRM has been integrated to enhance partner engagement, process efficiency, and
market responsiveness.

7. Product Quality and Innovation

Quality and R&D are foundational to KEI’s brand strength:
• The company’s NABL-accredited R&D facility supports the development of innovative and
compliant products.
• Recent innovations include EV Charging Cables, Medium Voltage Covered Conductor Cables,
and Conflame Green+ wires, positioning KEI as a forward-looking and reliable brand.
• Strategic partnerships, such as the one with Brugg Kabel AG for EHV cables, further enhance
product capabilities and brand perception.
KEI

Focus on Research & Development

KEI Industries Limited: Strategic Role of Research & Development (R&D)

KEI Industries Limited places strong strategic emphasis on its Research and Development (R&D) capabilities as
a critical enabler for innovation, product customization, and long-term competitiveness. R&D plays a central
role in helping the company respond to evolving customer needs, technological advancements, and emerging
market opportunities—especially in areas like sustainability and electric mobility.

1. Strategic Importance of R&D

• R&D is viewed as a core capability that fuels new product development and the delivery of tailored
solutions across geographies and industry sectors.
• It enables KEI to meet complex requirements from sectors such as oil & gas and shipping, supporting
higher institutional demand.
• By continuously enhancing its R&D capabilities, the company strengthens its competitive position and
intellectual capital.
• Customized product development helps expand market reach while maintaining pricing
competitiveness.

• R&D also reinforces KEI's product stewardship, focusing on efficiency, sustainability, and compliance—
differentiating the brand from competitors.

2. R&D Facility and Talent

• KEI’s advanced R&D facility is located in Rajasthan and is NABL-accredited under ISO/IEC 17025:2017.

• A dedicated team of engineers, designers, and technicians works collaboratively to drive innovation and
quality improvements across the company’s manufacturing units.

3. Focus Areas and Activities

• R&D is centered around developing high-quality, innovative, and customized products aligned with
specific customer requirements.

• Activities span:

o Process and design optimization across plants.

o Development of specialty cables for turnkey projects and niche applications.

o Innovation for sustainability—reducing water consumption, material use, waste generation, and
improving energy efficiency.

o Exploration of future market demands to stay ahead of trends and regulatory requirements.
KEI

4. Notable Product & Material Innovations

KEI has successfully developed several proprietary compounds and advanced cable products,
including:
a. PVC Compounds (In-house)
• Special FRLS, ST2 (for low temp), ST2 (5V90 – Australian standard), RoHS & REACH compliant,
TM-55 (high abrasion resistance), TPE Compound, Type D & ST3 (for lift cables), and Cadmium-
based orange color compound (anti-fade).
• These developments have resulted in cost savings and enhanced product quality.
b. Rubber Compounds (In-house)
• SHF-2 & SW-4 (LSZH for offshore/mud/ozone resistance), solar cable compounds, and
extremely low temperature compounds (-40°C to -60°C) for European markets.
• Work is ongoing for an in-house 35kV compound, currently imported.
c. Specialized Cable Developments
Examples of cable innovations include:
• EV Charging Cable (5X6+2X0.5), Battery Cable (1CX70) for EVs, and PEEK Cable (1CX4AWG).
• High-voltage and specialty cables like 400kV 1C x 2500 Sq.mm, 220kV 1C x 2000 Sq.mm, 132kV
Double Brass Tape, and others with optical fiber integration.
• Medium Voltage Covered Conductor (MVCC) Cable with a capacity of 800 km/month at the
Bhiwadi plant.
• Other products include Light Reflective Rubber Cable, LT Coaxial Cable, Conflame Green+ wires
(HR-FRLSH – Lead Free), and 0.200 mm Coated Spring Wire.

5. Process & Automation Enhancements

R&D has led to:
• Automation upgrades such as double-capacity single machines and high-speed concentric
copper taping heads—resulting in higher productivity and reduced labor costs.
• Innovations in base materials and special tapes for fire retardant and water-blocking
applications.
• New testing methodologies and equipment (e.g., bending test rig for 400kV cable, pulling eye
for vertical installation, degassing checks).

6. Investments in R&D
KEI invested ₹6.11 crore in FY 2022–23 and ₹1.21 crore in FY 2023–24 in R&D, reflecting its
continued commitment despite industry challenges.
 KEI
SWOT Analysis Strengths:
• KEI is one of the leading manufacturers of wires and
cables (W&C) in India. It ranks among the top three
organized players in the Indian W&C industry.

• KEI has a Pan-India retail presence with a wide

distribution network, including depots and a large
number of dealers/distributors.

Weakness:
• The company have been limited growth opportunities
due to capacity constraints in certain cable segments.

• Company has lower margins in the export business.

• The FMEG segment is currently operating at a loss.

Opportunities:
• The W&C industry is poised for accelerated growth
driven by factors such as expansion and modernisation
of power transmission and distribution infrastructure,
upgradation and expansion of the railway network,
increased investments in metro railroads, smart grid
initiatives, and development of smart cities.

• Opportunities exist in sunrise sectors like Renewables,

Defence, and Electric Vehicles. Polycab is developing
cables for these sectors and is in the process of
developing DC charging cables to leverage the
burgeoning electrical markets in automotive and EV.

• Rising demand in both domestic and export markets

creates a need for capacity enhancement initiatives to
ensure supply continuity and scalability.

Threats:
• Fluctuations in commodity prices.

• Disruption in supply chain would lead to disruption in

operations.

• The industry is facing intense competition from both

organized and unorganized players..
 KEI

Story in Charts
Exhibit 37 : Chart showing Product Mix Exhibit 38 : Chart showing Export as a % of Sales

16
4%
14
6%
12
10
8
6
90% 4
2
0
Cables & Wires Stainless Steel Wire EPC FY22 FY23 FY24

Exhibit 39 : Chart showing Ad spending as a % of Exhibit 40: Chart showing Marketing offices across
retail sales geographies

16
1.4 14
1.2
12
1
10
0.8
0.6 8
0.4 6
0.2 4
0 2
FY22 FY23 FY24
0
East West North South

Exhibit 41: Chart showing Sales & Sales Growth

Exhibit 42 : Chart showing Gross Profit &
Margin(%)
12,000 21% 2,200 2,175 30%
21% 9,736 27% 27%
10,000 20% 20% 2,100 25%
8,104
8,000 6,908 19% 2,000 1,94320% 20%
6,000 18% 1,900 1,852 15%
4,000 17% 17% 1,800 10%
2,000 16% 1,700 5%
0 15% 1,600 0%
FY23 FY24 FY25 FY23 FY24 FY25

Sales Growth (%) Gross Profit Margin (%)

 KEI

Story in Charts
Exhibit 43 : Chart showing EBITDA & Margin(%) Exhibit 44 : Chart showing PAT & Margins (%)

1,200 10% 800 7%

10% 991 696
7% 7%
1,000 10% 581
838 7%
600
800 702 10% 477
7%
600 10% 400
10% 7% 7%
400 10% 10%
200
7%
200 10%
0 7%
0 10%
FY23 FY24 FY25
FY23 FY24 FY25
PAT Margin (%)
EBITDA Margin (%)

Exhibit 45 : Chart showing ROE & ROCE Exhibit 46 : Chart showing Working Capital Days

20% 18% 18% 30% 250

25% 25% 25%
15% 200
12% 20%
10% 17% 15% 150
10%
5% 100
5%
0% 0% 50
FY23 FY24 FY25
0
ROE ROCE FY23 FY24 FY25

Exhibit 47 : Chart showing CWIP to Net Fixed

Assets
45.0%
40.0%
35.0%
30.0%
25.0%
20.0%
15.0%
10.0%
5.0%
0.0%
FY23 FY24 FY25
 KEI
Valuations & Views
Exhibit 48: Valuation
Amount in crores
Comparable Company Valuation

Market Data Financials Valuations

Share Share Equity Enterprise Net
Company Price Outstanding Value Net Debt Value RevenueEBITDA Income EV/Revenue EV/EBITDA P/E

Polycab 5,900 15.04 88,752 -569 88,183 22,408 2,960 2,046 3.9x 29.8x 43.4x
KEI 3,498 8.91 31,150 -1,698 29,452 9,736 991 696 3.0x 29.7x 44.8x
RR Kabels 1,300 11.31 14,705 63 14,768 7,618 486 312 1.9x 30.4x 47.1x

High 3.9x 29.8x 44.8x

3.7x 29.8x 44.4x
75th Percentile
Average 3.5x 29.8x 44.1x
Median 3.5x 29.8x 44.1x
3.3x 29.7x 43.7x
25th Percentile
Low 3.0x 29.7x 43.4x

KEI Comparable Valuation P/E

Implied Enterprise Value 89,592

Net Debt -569
Implied Market Value 90,161
Shares Outstanding 15.04

Implied Value per Share 5,994

Undervalu
ed

Valuation Methodology:

A Comparable Company Analysis (CCA) was conducted using three peer companies in the electrical
and cable manufacturing industry: Polycab, KEI, and RR Kabels. Key valuation multiples considered
were EV/Revenue, EV/EBITDA, and P/E Ratio, with P/E used as the primary metric for deriving the
implied valuation of KEI.

Based on the comparable company valuation and the derived premium in the implied share price
versus the current trading level, the stock appears to be undervalued. If the broader market and
business fundamentals remain positive, initiating or adding to a position in KEI could be a prudent
move. Investors might consider a Buy recommendation on the basis that the stock is trading at an
attractive valuation level relative to its intrinsic value.
 Equity research Report

RR Kabel Ltd.
Outperformance in Cables and Wires boosts overall earnings
Strong Brand Visibility through Sponsorships:
Reco : BUY
RR Kabel significantly enhanced its brand visibility during the quarter CMP : Rs. 1,300
through high-profile sports partnerships. It became the principal
Target Price :Rs. 1,667
sponsor of Kolkata Knight Riders (KKR) in the IPL and UP Warriorz in the
Women’s Premier League (WPL). These strategic associations were Potential target : 28%
designed to amplify brand recall, broaden market reach, and build
aspirational value across key consumer segments. The management Stock data (as on May 12, 2025)
emphasized that these activities are aligned with long-term brand
building and retail expansion goals, with accounting treatments done as Nifty :24,782
per standard norms. 52 Week H/L (in Rs.) : 1,903/750
Market Cap (in Cr.) : 14,705
Launch of Strategic Growth Plan 'Project Rise:
Outstanding Shares (Cr.) :10.71
The company announced a bold three-year strategic roadmap titled
Dividend Yield (%) : 0.47%
‘Project Rise’, aiming to accelerate growth in both the Wires & Cables
and FMEG segments. Under this plan, RR Kabel targets 18% CAGR in NSE Code : RRKABEL
Wires & Cables and 25% CAGR in FMEG, with the goal of achieving 2.5x
EBITDA growth by FY28. The growth strategy focuses on expanding Shareholding Pattern( May 12, 2025)
capacity, enhancing product mix, improving margins, increasing exports,
and capturing opportunities from infrastructure, data centers,
renewables, and real estate sectors. Promoters 61.80%
FIIs 7.17%
Export Market Growth and Outlook: DIIs 14.75%
Public 16.27%
Exports contributed 26% of total revenue in FY25, with an 11% YoY
growth despite macro uncertainties. The management highlighted
strong traction in the Europe market and resilience in the U.S.,
supported by a distributor-led model built over 20 years. Going
forward, RR Kabel expects further margin improvement in exports due
to a greater share of high-value cables, as opposed to wires. The Stock Performance (1 Year)
company views global trade shifts as favorable for Indian players and is
focused on entering new markets and categories to maintain export
momentum.

Capacity Expansion to Support Future Demand:

To support its ambitious growth plans, RR Kabel has laid out a ₹1,200
crore capex plan for FY26–28, targeting a 1.7x increase in production Nifty RR Kabel
capacity. The expansion is focused primarily on the cables segment,
with ongoing work at Waghodia and Silvassa. The company currently
operates at 75% overall utilization, with nearly 95% utilization in cables, 1M 6M 1Y
signaling the urgency for capacity addition. The new facilities are
expected to improve asset turns, enable higher margin products, and Absolute Return 38.6% -15.0% -22.7%
cater to both domestic and export markets efficiently.
RRKABEL

Exhibit 49: Earnings Call

Basis Q3 FY25 Q2 FY25 Views
Financial In Q3 FY25, revenue grew to In Q2 FY25, revenue stood at The financial performance in
Performance ₹1,782 crore (up 9.1% YoY), ₹1,665 crore, EBITDA was ₹105 Q3 demonstrated healthy
EBITDA reached ₹111 crore, crore, and PAT was ₹64 crore, recovery in profitability and
and PAT improved to ₹68.6 with margins slightly affected margin stability, signaling a
crore, indicating a sequential by commodity price strong exit to the fiscal year.
improvement in margins and fluctuations.
profitability.

FMEG The FMEG segment The FMEG business continued The FMEG business is steadily
Segment generated around ₹240 to grow in Q2, primarily moving toward breakeven as
Growth crore in revenue during Q3, supported by fan sales, strong volume growth,
driven by 55% YoY growth in although the segment still premiumization, and
fans and a better product reported overall losses. operational efficiency take
mix, resulting in a significant hold.
reduction in segment losses.

Exports In Q3, exports accounted for In Q2, export performance was The export rebound in Q3
Contribution 27% of total revenue, with temporarily impacted by Red reflects strong underlying
and renewed traction from Sea disruptions and shipment demand and positions RR Kabel
Momentum Europe and progress in delays, though Europe for accelerated global growth in
obtaining certifications for remained the company’s the upcoming quarters.
the U.S. market. largest export market.

Capacity During Q3, the cable In Q2, cable capacity was With sustained high utilization
Utilization segment operated at a high similarly stretched, and the levels, the need for timely
and utilization rate of 90–95%, company had already capacity expansion is evident
Expansion and the company confirmed commenced expansion projects and critical for meeting
that additional capacity will scheduled for completion by medium-term growth targets.
be added in the coming March and September FY25.
months to meet future
demand.
Capex Plan RR Kabel announced a In Q2, the company was in the The aggressive capex strategy
and Revenue ₹1,200 crore capex plan for final stages of its FY24–25 highlights management’s
Potential FY26–28, of which 80% will capex, with some new capacity confidence in future demand
be dedicated to the cables already operational by the end and its focus on scaling up the
segment, with the potential of the quarter. high-margin cables business.
to add ₹4,000–₹4,500 crore
in incremental revenue.
Market In Q3, the company In Q2, geographic expansion RR Kabel’s growing presence in
Expansion expanded its dealer network, efforts were ongoing, although underpenetrated regions is
and especially in South and East the revenue impact from newly expected to support industry-
Geographic India, and expects to see a added regions was still limited. beating growth over the
Penetration more visible impact from medium to long term.
these efforts in upcoming
quarters.
RRKABEL

About the company

Incorporated in 1995, RR Kabel provides consumer electrical products used for residential,
commercial, industrial, and infrastructure purposes in two major segments, namely wires and
cables including house wires, industrial wires, power cables, and special cables; and FMEG
including fans, lighting, switches, and appliances.
RR Kabel has two key manufacturing facilities for its W&C segment. The Waghodia plant in
Vadodara, Gujarat, and the Silvassa unit in the Union Territory of Dadra & Nagar Haveli and Daman
& Diu produce a range of products including house wires, industrial wires, power cables, special
cables, and switches.
For its FMEG segment, RR Kabel operates three plants. The Roorkee facility in Uttarakhand
manufactures fans and lighting products, while the Bengaluru unit in Karnataka focuses on lighting
and other FMEG items. Additionally, the Gagret plant in Himachal Pradesh produces premium and
mid-premium fans and lighting solutions.
The company operates in two main product segments: Wires and Cables, and FMEG (Fast Moving
Electrical Goods). The Wires and Cables division includes house wires, industrial wires, power
cables, control cables, solar cables, and special cables, commanding a significant 40% market share
in the Indian electrical industry as of FY24.
The FMEG segment comprises a wide range of electrical appliances such as room heaters, water
heaters, coolers, and irons. It also includes switches and switchgear products like modular
switches, MCBs, and distribution boxes. Additionally, the company offers a comprehensive range of
fans (ceiling, table/pedestal, and exhaust) and lighting solutions including bulbs, panels,
streetlights, and downlights

Exhibit 50 : Product Wise Breakup Exhibit 51 : Inventory, Debtors & Creditors Days

Product wise breakup

70
60

12% 50
40
30
20
88% 10
0
Jan-22 Jan-23 Jan-24 Jan-25

Wires & Cables FMEG Inventory Debtors Creditors

RRKABEL

Strong Distribution Network

RR Kabel has established a highly robust and far-reaching distribution network that supports its
strong presence in both the Indian and global markets. Domestically, as of March 31, 2024, the
company is supported by over 3,900 distributors, 4,000 dealers, 144,000 retailers, and 454,000
electricians. This comprehensive structure ensures effective and timely delivery of products across
India. The company operates 18 strategically located warehouses to streamline supply logistics and
optimize coverage. It also employs a dedicated sales and marketing team to manage stock flow,
track finances, and maintain relationships across the value chain.
RR Kabel has implemented multiple initiatives to deepen its market penetration. These include:
• Project KaRRma: Aims to increase market share and retail presence, especially in micro and nano
markets.
• Project Lakshya: Supports expansion of retail outlets to enhance reach in untapped areas.

• Market Segmentation Strategy:

o States are categorized as:

▪ Winner (market share >9%)

▪ Growing (5%–8.9%)

▪ Opportunity (<5%)
o This helps prioritize efforts and allocate resources smartly.

• Sales Channel Strengthening:

o Focus on boosting B2B and omni-channel capabilities.
o Aims to increase counter share in top-performing retail outlets.

• Depth vs. Breadth Strategy:

o Focus has shifted to increasing sales per distributor rather than adding more distributors.

• Cross-Leveraging Network:
o Existing W&C network is used to expand FMEG product sales efficiently.

• Electrician Engagement:

o Programs like RR Dosti 3.0, Udaan 3.0, and Kabel Star scholarship build loyalty and brand
preference among electricians.
RRKABEL

Initiatives to strengthen its brand

RR Kabel has adopted a multi-pronged approach to enhance its brand equity and market visibility,
especially in the highly competitive W&C and FMEG sectors. One of its core strategies is leveraging
its strong B2C presence, which commands higher gross margins and builds direct consumer loyalty.
The brand’s engagement with electricians through loyalty and scholarship programs not only drives
on-ground promotion but also fosters a sense of community and trust. This makes electricians
valuable brand ambassadors who recommend RR Kabel products to end-users.
The company is also expanding its presence in modern retail and e-commerce. It has achieved
leading sales ranks in specific FMEG categories on platforms like Amazon and Flipkart, and is
actively investing in digital marketing to reach tech-savvy consumers. Moreover, by mapping its
strong W&C network onto its FMEG segment, RR Kabel is successfully cross-selling electrical goods,
increasing brand touchpoints and consumer familiarity. Its ongoing efforts to increase depth rather
than breadth in distribution indicate a strategic shift toward strengthening existing relationships
and maximizing per distributor output. All these initiatives contribute to RR Kabel’s ambition to be
India’s most preferred brand in both W&C and FMEG.

Exhibit 52 : Number of Retailers Exhibit 53 : Domestic vs Exports

Number of Retailers Domestic vs Exports

1,60,000 120%

1,40,000 100%
1,20,000 80%
1,00,000 60% 76% 73% 76%
80,000
40%
60,000
20%
40,000 24% 27% 24%
20,000 0%
Q4FY24 Q3FY25 Q4FY25
0
2021 2022 2023 2024 Domestic Export
RRKABEL

Research & Development

RR Kabel has a dedicated R&D centre located in Waghodia, Gujarat. This centre is accredited by
NABL under ISO/IEC 17025:2017 and recognised by the Department of Scientific and Industrial
Research (DSIR), Ministry of Science and Technology, Government of India. In addition to this central
hub, the company also undertakes R&D activities at its manufacturing facilities.
As of March 31, 2024, the company has 86 employees focused on R&D, including 23 exclusively for
the FMEG segment. The R&D team works closely with a cross-functional product development team
and engages with customers and key opinion leaders to ensure relevant innovation.
RR Kabel's R&D efforts are aimed at improving product quality, enhancing performance, meeting
evolving industry standards, and expanding the product portfolio. The company also focuses on
entering adjacent categories and creating solutions that address environmental and social impact.
The company has introduced several notable innovations through its R&D. These include Low-Smoke
Zero Halogen (LS0H) insulation technology, Unilay Core Technology (UCT), and E-Beam cross-linking
technology. It was also the first Indian company to launch products compliant with European
regulations such as REACH, RoHS, and CPR.
R&D has also led to the development of new product categories such as eco-friendly wires, BLDC
fans, and FIREX LS0H cables. As of March 31, 2024, the company had 116 products under
development and had already developed 347 new FMEG products.
In FY24, RR Kabel incurred ₹330.39 lakh in total R&D expenditure—₹39.73 lakh in capital
expenditure and ₹290.66 lakh in revenue expenditure. This was a rise from ₹219.17 lakh spent in
FY23. R&D investments are also aligned with sustainability goals, targeting products with lower
environmental and social impact.
The company has introduced several notable innovations through its R&D. These include Low-Smoke
Zero Halogen (LS0H) insulation technology, Unilay Core Technology (UCT), and E-Beam cross-linking
technology. It was also the first Indian company to launch products compliant with European
regulations such as REACH, RoHS, and CPR.
R&D has also led to the development of new product categories such as eco-friendly wires, BLDC
fans, and FIREX LS0H cables. As of March 31, 2024, the company had 116 products under
development and had already developed 347 new FMEG products.
In FY24, RR Kabel incurred ₹330.39 lakh in total R&D expenditure—₹39.73 lakh in capital
expenditure and ₹290.66 lakh in revenue expenditure. This was a rise from ₹219.17 lakh spent in
FY23. R&D investments are also aligned with sustainability goals, targeting products with lower
environmental and social impact.
RR Kabel is also investing in R&D to support emerging industry trends. These include 5G telecom
cables, EV charging cables, smart fans, and designer lighting, ensuring the company stays ahead in
innovation-driven categories.
RRKABEL

Capacity Expansion
Current Capex Cycle (FY24–FY25):
RR Kabel is executing a ₹500 crore capital expenditure program across FY2024 and FY2025, fully
funded through internal accruals. This capex is focused on enhancing production capabilities,
including the expansion of its electron beam (e-beam) facility and power cable capacity at the
Waghodia plant. The entire capex cycle is on track and expected to be completed by March 2025.
Some capacity additions began in Q3 FY25, and machines will come online in phases through
September–October. The company expects this investment could add ₹2,500 crore to its top line.

Next Capex Cycle (FY26–FY28):

Starting April 2025, RR Kabel plans a new ₹1,200 crore capex cycle spread over three years (FY26–
FY28). This will primarily be a brownfield expansion at the existing Waghodia facility. Around 80% of
the planned spend will be directed toward the cables segment, where RR Kabel sees strong growth
potential. The company anticipates this expansion could generate an additional ₹4,000–₹4,500 crore
in annual revenues, aiming for a 3x–3.5x return on investment based on industry benchmarks

Capacity Overview – Wires & Cables Segment:

The company operates two manufacturing plants in Waghodia and Silvassa, with a total annual
capacity of 4.2 million CKM (Cable Kilometres). Waghodia alone has 2.1 million CKM capacity as of
March 2023. In FY25, capacity utilization was high: 90–95% for cables and 65–70% for wires. Due to
rising demand, the company is nearly doubling its power cable capacity and increasing wire capacity
by 20–25%. Most of this new capacity will come online by April 2025. RR Kabel also maintains
backward integration by producing raw materials like PVC, LS0H, XLPE, and solar cable compounds
in-house.

Market Demand Outlook:

Despite several players investing in capacity expansion, RR Kabel believes cable demand will outpace
supply for at least the next 3–4 years. Growth drivers include government infrastructure projects,
solar energy initiatives, and export opportunities. The company sees this as a strong opportunity to
capitalize on the supply-demand mismatch in the cable sector.

FMEG Segment Strategy:

RR Kabel manufactures FMEG products like switches, fans, and lights across multiple facilities:
switches at Waghodia, fans at Gagret and Roorkee, and lights at Roorkee and Bengaluru. Installed
capacities include 3.3 million fans annually, 2 million+ lighting units, and 8.9 million switches.
However, capacity utilization varies—ranging from 18% to 83% depending on the product and
location. Approximately 37% of FMEG products (by value) are manufactured in-house, while two-
thirds of revenue comes from traded goods. The company has no major capex plans for FMEG,
limiting investments to ₹20–₹25 crore and continuing to rely on third-party sourcing
RRKABEL
SWOT Analysis Strengths:
• RR Kabel is identified as the 4th largest player in the
Indian W&C industry by value as of 2023-24. It holds
approximately 5% of the overall Indian W&C market
share and a 7% market share among the top 4 branded
W&C players.

• RR Kabel is the Largest Exporter of Wires & Cables from

India. They hold approximately a 10% market share of
W&C exports from India as of FY24.

Weakness:
• The company have been limited growth opportunities
due to capacity constraints in certain cable segments.

• Company has lower margins in the export business.

• The FMEG segment is currently operating at a loss.

Opportunities:
• The W&C industry is poised for accelerated growth
driven by factors such as expansion and modernisation
of power transmission and distribution infrastructure,
upgradation and expansion of the railway network,
increased investments in metro railroads, smart grid
initiatives, and development of smart cities.

• Opportunities exist in sunrise sectors like Renewables,

Defence, and Electric Vehicles. Polycab is developing
cables for these sectors and is in the process of
developing DC charging cables to leverage the
burgeoning electrical markets in automotive and EV.

• Rising demand in both domestic and export markets

creates a need for capacity enhancement initiatives to
ensure supply continuity and scalability.

Threats:
• Fluctuations in commodity prices.

• Disruption in supply chain would lead to disruption in

operations.

• The industry is facing intense competition from both

organized and unorganized players..
RRKABEL

Financials
Exhibit 54 : Consolidated Profit & Loss Account
Particulars Q4 FY25 Q4 FY24 Y-o-Y Q3 FY25 Q-o-Q FY25 FY24 Y-o-Y
Revenue from Operations 2,217.80 1,754.10 26.40% 1,782.20 24.40% 7,618.20 6,594.60 15.50%
Cost of Materials Consumed 1,549.70 1,340.10 - 1,391.40 - 5,836.80 4,942.60 -
Purchase of Stock-in-trade 126 97.5 - 127.1 - 495.3 403.6 -
Changes in Inventories of FG & WIP 107.5 -6.3 - -63.1 - -77.1 2.7 -
Gross Profit 434.6 322.7 34.70% 326.7 33.00% 1,363.30 1,245.70 9.40%
GP % 19.60% 18.40% - 18.30% - 17.90% 18.90% -
Employee Benefits Expense 79.6 78 - 90.8 - 348.5 316.9 -
Other Expenses 160.6 129.4 - 125.4 - 529.2 467.1 -
Share of Profit of JV (net of tax) 1.4 0.2 - 0.4 - 2.1 1.1 -
EBITDA 195.8 115.5 69.40% 111 76.40% 487.7 462.8 5.40%
EBITDA % 8.80% 6.60% - 6.20% - 6.40% 7.00% -
Other Income 11.9 19.3 - 13.4 - 51.1 62.6 -
Depreciation & Amortisation 19 16.3 - 17.8 - 70.5 65.5 -
EBIT 188.7 118.6 59.10% 106.6 77.00% 468.4 459.9 1.80%
Finance Costs 15.5 12.8 - 16.2 - 58.9 53.9 -
PBT 173.2 105.7 63.80% 90.5 91.40% 409.5 406.1 0.80%
Tax Expense 44.1 27 - 21.9 - 97.8 108 -
Profit for the Period 129.1 78.7 64.00% 68.6 88.30% 311.6 298.1 4.50%
PAT % 5.80% 4.50% - 3.80% - 4.10% 4.50% -
EPS (As per Profit after Tax) 11.4 7 - 6.1 - 27.6 26.6 -

Exhibit 55 : Consolidated Balance Sheet

Rs. (Cr) FY 25 FY24

Equity Share Capital 57 56
Reserves 2,096 1,772
Borrowings 290 360
Other Liabilities 1,084 681
Total Liabilities 3,517 2,869

Fixed Assets 769 535

Capital Work in Progress 235 164
Investments 239 342
Other Assets 2,274 1,830
Total Assets 3517 2,869
RRKABEL

Story in Charts
Exhibit 56 : Chart showing Sales & growth margin(%) Exhibit 57: Chart showing Gross Profit & margin(%)

8,000 7,618 30% 1,400 1,286 20%

1,24819%
7,000 28% 6,595
25% 1,200 17%
6,000 5,599 15% 15%
1,000 861
5,000 20%
18% 800
4,000 16% 15% 10%
600
3,000 10%
2,000 400 5%
1,000 5% 200
0 0% 0 0%
FY23 FY24 FY25 FY23 FY24 FY25

Sales Growth (%) Gross Profit Margin (%)

Exhibit 58 : Chart showing EBITDA & EBITDA margin(%) Exhibit 59: Chart showing PAT & PAT margin(%)
600 8% 400 5%
486
500 462 7% 298 5% 312
4%
6% 6% 300 4%
400 6% 3%
323 3%
190
300 4% 200
2%
200
2% 100 1%
100
0 0% 0 0%
FY23 FY24 FY25 FY23 FY24 FY25

EBITDA Margin(%) PAT Margin (%)

Exhibit 60: Chart showing ROE & ROCE Exhibit 61: Chart showing CWIP to Net Fixed
Asset

20% 25% 40%

16% 31%
21% 14% 31%
15% 13% 19% 20% 30%
15% 15%
10% 20%
10%
8%
5% 5% 10%

0% 0% 0%
FY23 FY24 FY25 FY23 FY24 FY25

ROE ROCE CWIP to Net Fixed Assets

RRKABEL

Valuations & View

Exhibit 62: Valuations
Amount in crores
Comparable Company Valuation

Market Data Financials Valuations

Share Share Equity Enterprise Revenu Net
Company Net Debt EBITDA EV/Revenue EV/EBITDA P/E
Price Outstanding Value Value e Income

RR Kabel 1,231 11.31 13,922 63 13,985 6,595 462 298 2.1x 30.3x 46.7x
Finolex Cable 895.00 15.31 13,701 -79 13,622 5014 581 572 2.7x 23.4x 24.0x
KEI Industries 3,295 9.56 31,487 -1,698 29,789 8,104 838 581 3.7x 35.5x 54.2x

High 3.7x 35.5x 54.2x

75th
3.2x 32.9x 50.5x
Percentile
Average 2.8x 29.8x 41.6x
Median 2.7x 30.3x 46.7x
25th
2.4x 26.9x 35.3x
Percentile
Low 2.1x 23.4x 24.0x

RR Kabel Comparable Valuation EV/Revenue

Implied Enterprise Value 17,917

Net Debt 63
Implied Market Value 17,854
Shares Outstanding 11.31

Implied Value per Share 1,579

Undervalued

RR Kabel appears to be undervalued compared to its peers based on the EV/Revenue multiple.
Despite trading at a lower revenue multiple, it commands similar or even higher P/E and EV/EBITDA
multiples, suggesting investors recognize its profitability and growth potential—but the market has
not fully priced that in yet.

Recommendation:

RR Kabel looks like an attractive investment opportunity from a relative valuation perspective, with
potential upside of ~28%.
Equity research Report

Paramount Communications Ltd

Strong Revenue Momentum
Paramount Communications Ltd is engaged in manufacturing of Wires Reco : BUY
and Cables comprising of power cables, telecom cables, railway cables
and specialised cables. The company offers LT and HT Power Cables, CMP :Rs. 47
House wires, Optical Fiber Cables & other Telecom Cables, Railway Target Price :Rs. 50
Cables, Specialized Cables, Instrumentation & Data Cables, Fire Survival
Cables, etc. In Aug 2023, the company acquired a 100% stake in Valens Potential target : 6.4%
Technologies Pvt Ltd, for Rs. 2 Cr, a manufacturer of HDPE pipes used in
the telecom network and water pipeline businesses. Stock data (as on May 12, 2025)
Nifty :24,782
Strong Financial Growth with Robust Volume and Export 52 Week H/L (in Rs.) : 101/ 44
Momentum:
Market Cap (in Cr.) : 1,433
In Q3 FY25, Paramount Communications reported revenue of ₹392 Outstanding Shares (Cr.) :30.53
crores, marking a 38% YoY increase, while 9M FY25 revenue stood at Dividend Yield (%) : 0.00%
₹1,069 crores, up 43% YoY. EBITDA grew 45.5% YoY to ₹37.3 crores in NSE Code : PARACABLES
Q3 with a margin of 9.44%, and for the nine-month period, EBITDA
reached ₹100.8 crores with a 9.36% margin. Profit After Tax (PAT) in Q3
was ₹22.6 crores (2.6% growth), and for 9M FY25 it stood at ₹68.2 Shareholding Pattern( May 12, 2025)
crores (21.7% growth), with PAT margins declining YoY due to tax Promoters 49.06%
applicability this year. Export sales surged 138% in Q3 to ₹146 crores,
FIIs 0.83%
forming 37% of total revenue, while domestic cable sales stood at ₹246
crores, driven by 48% growth in power cable sales. Metal consumption DIIs 0.00%
rose 57% YoY in Q3 to 7,330 metric tons, showing increased production Govt 1.70%
efficiency. Public 48.42%

Aggressive Capex Backed by New Greenfield Expansion in MP: Stock Performance (1 Year)
The company incurred ₹62 crores in CAPEX during FY24 and ₹43 crores
during 9M FY25, aiming to reach ₹70 crores by the end of FY25. With
capacity running at near 100%, Paramount is expanding aggressively
and has been allotted 31 acres of industrial land in Madhya Pradesh to
build a new greenfield manufacturing plant. The total project cost
(excluding land) is estimated at ₹250 crores, with initial revenues from
the plant expected in FY27 and full capacity expected by FY28–FY29,
effectively doubling the company's revenue capability. Nifty Paramount

U.S. Tariff Landscape Favourable; Temporary Reversal by Trump

Adds a Twist: 1M 6M 1Y
Absolute Return -4.4% -31.5% -35.1%
The company is optimistic about the evolving U.S. tariff scenario, which
may benefit its export competitiveness. A proposed 25% U.S. import
duty on cables from Mexico and Canada and 10% additional duty on
Chinese goods are seen as favorable to Indian manufacturers like
Paramount. The management clarified that even if tariffs are extended
globally, their impact would be minimal on Paramount’s margins due to
the universal nature of such duties and the company’s focus on higher-
margin, steady B2C distribution in the U.S. Additionally, former
President Donald Trump has reversed the reciprocal tariff policy for a
temporary period of 90 days, which may create short-term price
pressure; however, the company expects minimal impact as its U.S.
distributor-led model ensures stable demand and pricing resilience.
PARACABLES

Exhibit 63: Earnings Call Highlight

Basis Q3 FY25 Q2 FY25 My Views

Financial Paramount reported revenue of ₹392 Revenue came in at ₹356 crores, up 41% Financial metrics clearly show
Performance crores, up 38% YoY and 10% QoQ. YoY. EBITDA was ₹33.6 crores with a sequential growth. Volume,
EBITDA stood at ₹37.3 crores with a margin of 9.38%, and PAT stood at ₹20.3 revenue, and export share all
margin of 9.44%, while PAT was ₹22.6 crores with a margin of 5.7%, impacted improved. Margins remain stable
crores at a margin of 5.7%, impacted by by tax provision. Export revenue was despite tax, and the growing export
taxation. Export sales jumped to ₹146 ₹102 crores (29% of sales), and metal order book is a structural strength.
crores, forming 37% of total revenue. consumption was ~3,427 MT. Order book Clean, strong execution.
Metal consumption rose to 7,330 MT, was ₹619 crores, with ₹192 crores from
up 57% YoY, reflecting strong volume exports and ₹427 crores from domestic
traction. Order book stood at ₹620 orders.
crores, including ₹234 crores exports
and ₹386 crores domestic.

Capex The company incurred ₹43 crores of Capex of ₹27 crores was done in H1 FY25, Capex guidance was raised,
capex in 9M FY25 and raised its full-year with total FY25 guidance then estimated indicating stronger execution
guidance to ₹70 crores. Focus is on at ₹54–60 crores. Capacity target of visibility. Strategy is clear —
debottlenecking and optimization of 33,000 MT by FY26 was unchanged. maximize current plant potential
the two existing plants. Target capacity before new greenfield capex
remains 33,000 MT by FY26, supporting begins. Capacity ramp-up is on
a ₹1,800 crore revenue potential. track.

US Tariff Management highlighted that U.S. tariff Management emphasized their strong Tariff developments only enhance
policies remain favourable, especially U.S. positioning with pricing insulation Paramount’s relative advantage.
with proposed 25% import duty on due to distributor relationships. They saw Temporary volatility (Trump’s
Mexico and Canada and 10% on China. the global tariff environment shifting in reversal) is immaterial in light of
Trump reversed reciprocal tariffs for 90 India’s favour. stable U.S. contracts. Export moat
days, which may cause short-term is durable.
pressure, but the distributor-led, firm-
priced U.S. model offers margin
protection.

Negative Management confirmed that negative Working capital days improved from 137 Cash flow outlook is improving.
cash flow cash flow in FY24 was due to higher (FY24-end) to 109 in Q2. Management With no debt and equity buffer,
inventory and working capital buildup, cited lack of channel financing and high business can absorb near-term
funded by equity. They expect positive inventory as temporary factors. working capital pressure.
operating cash flow in FY25 as inventory Turnaround expected in FY25.
normalizes and profitability improves.

Consumption The Company consumed 7,330 metric The Company consumed 10,757 metric The slight dip in metal
of metals tons of metal in Q3FY25. tons of metal in Q2FY25. consumption in Q3 FY25 compared
to Q2 suggests that revenue growth
was driven more by improved
realizations and product mix rather
than pure volume. It’s not a
concern yet but signals the need
for new capacity to sustain growth.
PARACABLES

About the company

Paramount Communications Limited is a leading Indian manufacturer of cables and wires, with a
legacy of nearly 70 years. The company caters to a wide range of critical sectors including Power,
Telecom, Railways, Renewables, Defence, Space Research, Construction, and Oil & Gas, serving
over 600 institutional clients across both domestic and international markets.

Core Business & Product Segments

Paramount derives 97.83% of its turnover from manufacturing cables and wires, offering over 25
product categories and 2,500+ SKUs, including:
• Power Cables (42.4% of revenue): LT & HT cables, aerial bunch cables, control and
instrumentation cables, covered conductors, and UL-certified cables.
• Telecom Cables (5.6–15%): Optical fiber cables, FTTH, jelly-filled cables, CATV, and jumper
wires.
• Railway Cables (6–15.7%): Signalling, railway power, and axle counter cables.
• Domestic/House Wires (6.2%): Fire-retardant, lead-free building wires with a 20-year
warranty.
• Special Cables: Fire survival, solar, PTFE, LAN, submersible, and HTLS cables.
• HDPE Pipes: Manufactured through subsidiary Valens Technologies for telecom and water
pipelines.

Turnkey Services & EPC Projects

In addition to products, Paramount provides specialized turnkey solutions and EPC services in
telecom, power, and railway infrastructure. This segment contributed 2.17% to FY2024 turnover,
with capabilities in telecom consultancy, OPGW, and submarine cable installations.

Exhibit 64: Product Mix

Product Mix
2%

98%

Wires & Cables Pipes

PARACABLES

Capex story of the company

Paramount Communications Limited is undertaking substantial capital expenditure (CAPEX) to expand its
production capacity and support its medium-to-long-term growth objectives. The company’s CAPEX strategy
is focused on both enhancing existing facilities and establishing a new greenfield manufacturing unit.

CAPEX on Existing Facilities

Paramount operates two manufacturing plants located at Khushkhera (Rajasthan) and Dharuhera
(Haryana). To improve output efficiency and meet rising demand, the company is consistently investing in
brownfield CAPEX at these locations. Key initiatives include machinery upgrades, capacity balancing, and
debottlenecking processes.

• FY 2022–23: CAPEX of ₹8.95 crore was undertaken, resulting in a noticeable improvement in turnover.

• FY 2023–24: CAPEX of ₹51.04 crore was invested, with total CAPEX during the year exceeding ₹60
crore, aimed at optimizing production capacity.

• FY 2024–25 (ongoing):
o H1 FY25: CAPEX spend amounted to ₹27 crore.

o 9M FY25: Cumulative CAPEX reached ₹43 crore.

o Full-year target: Estimated at around ₹70 crore, largely focused on upgrades to existing
facilities.

The company has been operating near full effective capacity (close to 100%) for the past 8–10 quarters,
which has necessitated continuous investment. However, space limitations at the current sites place a cap on
further expansion.

Greenfield Manufacturing Plant – Madhya Pradesh

To overcome the spatial constraints at existing sites and scale operations further, Paramount has initiated
plans for a greenfield manufacturing plant:

• The company has been allotted 31 acres of industrial land by MPIDC in Narmadapuram, Madhya
Pradesh, at concessional rates.

• The plant will be dedicated to wires and cables manufacturing, with registration of land expected
shortly and construction to commence soon after.

• Total project cost (excluding land): Approximately ₹250 crore.

• Timeline: Project to be executed over 1.5 to 2 years.

• Revenue contribution: The plant is expected to begin commercial production by December 2026, and
start contributing to revenues from FY27 onwards.

• Capacity expansion impact: The new facility is projected to double the company's revenue potential,
as current plants are expected to max out around ₹2,000 crore in annual revenue by FY26.
PARACABLES

CAPEX Funding Strategy

Paramount is currently a debt-free company, with only minor liabilities (e.g., policy and vehicle loans), and a
debt-to-equity ratio of just 0.02 as of September 30, 2024. As per the FY24 Annual Report (dated August 8,
2024), the company maintained a zero-debt position.

• CAPEX funding will be sourced through a mix of internal accruals, equity, and potential debt
instruments.

• A Qualified Institutional Placement (QIP) is under consideration for raising funds.

• Between Q4 FY23 and Q4 FY24, the company raised ₹317.2 crore in equity capital, which was partly
utilized for CAPEX, debt repayment, and capacity enhancement.

Financial Statement Insights (FY24)

• Capital Work-in-Progress (CWIP): Additions of ₹1.49 crore on a standalone basis.

• Capital Advances: Jumped from ₹1.02 crore (FY23) to ₹9.01 crore (FY24), likely related to upcoming
CAPEX projects.
• Unexecuted Capital Contracts (Net of Advances): Increased significantly from ₹0.89 crore (FY23) to
₹21.98 crore (FY24), indicating substantial CAPEX commitments ahead.
PARACABLES

Exhibit 65: Consolidated Income Statement

Particulars (Rs. In Mn) Q3FY25 Q3FY24 YoY (%) Q2FY25 9M FY25 9M FY24 YoY (%)
Revenue from Operations 3,916.40 2,842.50 37.80% 3,558.90 10,685.80 7,472.30 43.00%
Other Income 37.1 15.8 22.8 91.4 52
Total Revenue 3,953.40 2,858.30 38.30% 3,581.70 10,777.20 7,524.30 43.20%
Total Expenses (excl. D&A and Finance Cost) 3,580.10 2,601.80 3,245.80 9,768.90 6,850.50
EBITDA * 373.3 256.5 45.50% 335.9 1,008.30 673.8 49.60%
EBITDA Margin % 9.40% 9.00% 9.40% 9.40% 9.00%
Depreciation & Amortization 32.2 24.1 27.8 87.5 68
Finance Cost 35.8 11.9 17 65.4 44.8
PBT 305.3 220.6 38.40% 291.1 855.5 560.9 52.50%
PAT Margin % (before Tax) 7.70% 7.70% 8.10% 7.90% 7.50%
Tax Expense 79.3 0.3 87.8 173.2 0.4
PAT 226 220.3 2.60% 203.3 682.3 560.5 21.70%
PAT Margin % (after Tax) 5.70% 7.70% 5.70% 6.33% 7.45%
Diluted EPS 0.7 0.8 0.7 2.2 2.4
* EBITDA includes other income
Source: Company Report

Exhibit 66 : Revenue From Operations Exhibit 67 : EBITDA & EBITDA Margins

4,500 400 9.60%

4,000 9.40% 9.40%
3,500 300 9.40%
3,000
2,500 200 9.20%
2,000
100 9.00% 9.00%
1,500
1,000 0 8.80%
500 Q3FY24 Q2FY25 Q3FY25
0
Q3FY24 Q2FY25 Q3FY25 EBITDA EBITDA Margin

Exhibit 68 : Revenue from Operations Exhibit 69 : EBITDA & EBITDA Margins

4,000
3,500
1,200 9.5%
3,000
1,000 9.4% 9.4%
2,500 9.3%
800
2,000 9.2%
600
1,500 9.0% 9.1%
400
9.0%
1,000
200 8.9%
500
0 8.8%
0 9M FY25 9M FY24
9M FY25 9M FY24
EBITDA EBITDA Margin
PARACABLES

Valuation & Views

Exhibit 70: Valuation
Amount in crores
Comparable Company Valuation

Market Data Financials Valuations

Share Share Equity Enterprise Net

Company Price Outstanding Value Net Debt Value RevenueEBITDA Income EV/Revenue EV/EBITDA P/E

Polycab 5,900 15.04 88,752 -569 88,183 22,408 2,960 2,046 3.9x 29.8x 43.4x
KEI 3,498 8.91 31,150 -1,698 29,452 9,736 991 696 3.0x 29.7x 44.8x
RR Kabels 1,300 11.31 14,705 63 14,768 7,618 486 312 1.9x 30.4x 47.1x
Paramount 47 31.57 1,484 1 1485 1068 89 86 1.39 16.69 17.26

High 3.9x 30.4x 47.1x

75th
3.3x 29.9x 45.3x
Percentile
Average 2.6x 26.6x 38.1x
Median 2.5x 29.8x 44.1x
25th
1.8x 26.5x 36.8x
Percentile
Low 1.4x 16.7x 17.3x

Paramount Comparable Valuation

EV/Revenue EV/EBITDA P/E

Implied Enterprise Value 2,651 2,648 3,791

Net Debt 1 1 1
Implied Market Value 2,650 2,647 3,790
Shares Outstanding 31.57 31.57 31.57

Implied Value per Share 84 84 120

Undervalue
Undervalued Undervalued d

The valuation compares Paramount with listed peers: Polycab, KEI, and RR Kabels using
EV/Revenue, EV/EBITDA, and P/E multiples.

Interpretation & Insights

•All three valuation metrics suggest Paramount is trading below its intrinsic value, as per peer
comparison.

•The implied fair value per share ranges from ₹84 to ₹120, compared to the current market price
of ₹47.

•The most compelling upside is seen from the P/E multiple, where the implied value is more than
2.5x the current price.

•Paramount’s current EV/EBITDA of 16.69x is significantly lower than the peer median of 29.8x,
suggesting potential for re-rating.

Paramount appears fundamentally undervalued when benchmarked against comparable listed

peers. If the company continues to grow and improve margins while maintaining visibility, there
could be a significant upside to its current market price.
PARACABLES

SWOT Analysis Strengths:

• Longstanding market presence in the cable and wire
industry, supported by the extensive experience of the
promoters.

• Diversified product portfolio and end-user industry base

• Healthy financial risk profile.

Weakness:
• Large working capital requirment.

• Promoter has significantly reduced its shareholdings in

the last 2 years.

Opportunities:
• There is significant potential in India’s core infrastructure
sectors—including energy, communication,
transportation, and railways—driven by public-private
partnerships, rural electrification, smart cities, and
increased digitalization.

• International expansion remains a key growth avenue,

especially in unfragmented and high-potential markets
like the United States, with increasing export
contributions already visible.

• Rising demand in both domestic and export markets

creates a need for capacity enhancement initiatives to
ensure supply continuity and scalability.

Threats:

• Fluctuations in commodity prices.

• Disruption in supply chain would lead to disruption in

operations.

• The industry is facing intense competition from both

organized and unorganized players..
Financial Comparison
Exhibit 71 : Material Cost (% of Sales) comparison among peers.
Material Cost (%of Sales) 2021 2022 2023 2024

RR kabel 85% 85% 85% 81%

Finolex 80% 77% 79% 78%
KEI 63% 77% 73% 73%
Polycab 72% 81% 73% 73%
Paramount 77% 79% 74% 79%

In the wires and cables industry, raw materials typically make up 75–80% of the total cost structure,
with copper and aluminium being the most significant components. Copper alone accounts for
approximately 55–60% of input costs, and since India is heavily reliant on imports for copper, it
introduces cost sensitivity. Aluminium contributes around 15–20%, and India, being the second-
largest producer and third-largest consumer globally, is relatively better positioned in terms of supply.
Among industry peers, Polycab and KEI have the lowest material cost-to-sales ratios, indicating better
cost efficiency. RR Kabel has historically had the highest material cost, though this is now on a
declining trend as the company increasingly focuses on backward integration. Paramount, on the
other hand, also has a high and volatile material cost percentage, but its ongoing capex is primarily
aimed at expanding manufacturing capacity, not backward integration, which limits its ability to
control material costs in the near term.

Exhibit 72: Selling & Admin Cost (% of Sales) comparison among peers
Selling And Admin Cost (% of Sales) 2021 2022 2023 2024

RR kabel 4% 5% 5% 5%
Finolex 3% 2% 3% 3%
KEI 4% 4% 4% 4%
Polycab 4% 4% 5% 4%
Paramount 5% 6% 11% 7%

Wires and cables are largely homogeneous products with low customer repeatability, meaning end-
users rarely return frequently for purchases. As a result, companies can grow sales primarily through
strong branding, consistent advertising, and by building relationships with electricians and dealers.
Paramount’s higher SG&A (Selling, General & Administrative) expenses reflect this strategy, which is
also driving its strong sales growth.
Financial Comparison
Exhibit 73: Net Profit Margin comparison among peers
Net Profit Margin 2021 2022 2023 2024

RR kabel 5% 5% 3% 5%
Finolex 10% 11% 11% 11%
KEI 6% 7% 7% 7%
Polycab 10% 8% 9% 10%
Paramount 1% 1% 6% 8%

Both Finolex Cables and Polycab India Limited appear to achieve relatively high net profit margins
through a combination of strategic product focus on higher-margin segments like housing wires,
efficient management of raw material costs (through pricing strategies or pass-through mechanisms),
backward integration, and operational efficiencies. Polycab specifically emphasizes its product mix,
pricing power, operational leverage, and backward integration, while Finolex highlights cost control,
revenue growth, and the strength of its core electrical cables business despite challenges in other
segments like communication cables. Polycab's stated position as the most profitable company
indicates a strong overall performance across profitability metrics.

Exhibit 74: Working Capital Days comparison among peers

Working Capital Days 2021 2022 2023 2024

RR kabel 120 88 64 56
Finolex 202 159 120 68
KEI 118 102 87 77
Polycab 73 69 60 61
Paramount 147 134 123 155

Finolex experienced elevated working capital days in FY21, primarily due to disruptions caused by the
COVID-19 pandemic. However, the company made significant progress in streamlining its working
capital cycle over the following two years—reducing it to 81 days in FY22 and further down to 64
days in FY23, marking an overall improvement of 50 days. This sharp reduction was driven by
strategic operational measures, including better inventory management and a focused effort to
reduce receivables through initiatives like the "cash and carry" model in retail sales.
Paramount's working capital increased primarily because significant funds were raised through equity
specifically to support the substantial growth in revenue and operational activity after overcoming a
period of financial stress.
Disclaimer: This is an academic project and doesn’t meant for commercial usage.

This information/document does not constitute an offer to sell or solicitation for the purchase or
sale of any financial instrument or as an official confirmation of any transaction. The information
contained herein is obtained from publicly available data or other sources believed to be reliable
and the Author has not independently verified the accuracy and completeness of the said data and
hence it should not be relied upon as such.

Author is not SEBI registered investment analyst. This document is prepared as part of academic
project.
Investment in securities market are subject to market risks, read all the related documents
carefully before investing. The securities quoted are for illustration only and are not
recommendatory. Registration granted by SEBI, and certification from NISM in no way guarantee
performance of the intermediary or provide any assurance of returns to investors.