Leading players in India's cables and wires (C&W) industry, including Polycab India, RR Kabel, and KEI Industries, are poised for significant growth, driven by the nation's accelerating infrastructure development and expanding electrification initiatives. Brokerage firm Motilal Oswal has reviewed these companies, upgrading RR Kabel to 'Buy' and reiterating 'Buy' ratings for Polycab and KEI Industries, along with revised price targets.
Infrastructure Fuels Cable Industry Expansion
The domestic C&W industry has emerged as a major beneficiary of India's robust infrastructure push. Between FY22 and FY26, the sector recorded a compound annual growth rate (CAGR) of 12.5%, reaching an estimated market size of Rs 1 lakh crore. This growth is broad-based, stemming from diverse end-user industries such as power transmission and distribution, residential and commercial real estate, railways, telecommunications, renewable energy projects, and industrial capital expenditure.
Organized players have significantly outpaced the overall industry, growing at approximately 17% during the same period. This has led to a notable shift, with the share of organized companies increasing from about 67% in FY22 to nearly 80% in FY26, indicating ongoing market consolidation and a preference for branded, quality-focused products.
Motilal Oswal's Outlook and Price Targets
Motilal Oswal projects continued strong performance for these industry leaders. Polycab led growth with a 24% increase between FY22-26, followed by KEI and RR Kabel at 21% each, and Havells at 17%.
- Polycab: The brokerage expects Polycab to maintain its industry-leading growth with a 22% revenue CAGR over FY26-28. Motilal Oswal has reiterated a BUY rating with a target price of Rs 11,950. EPS estimates for Polycab were raised by 8% for FY27-28.
- RR Kabel: Upgraded to BUY from 'Neutral', RR Kabel is projected to achieve a 21% revenue CAGR over FY26-28. The new target price is Rs 2,600, reflecting a strong growth outlook and margin expansion. EPS estimates for RR Kabel were raised by 11% for FY27-28.
- KEI Industries: Motilal Oswal has maintained a BUY rating for KEI Industries, forecasting a 21% revenue CAGR over FY26-28. The target price for KEI Industries is set at Rs 6,640.
The brokerage firm expressed confidence that the demand tailwinds for the sector will remain robust over the long term, supported by capacity expansions, market share gains, and margin improvements for these key players.
Disclaimer: This article provides stock market news for informational purposes only and should not be construed as investment advice. Readers are encouraged to consult with a qualified financial advisor before making any investment decisions.