Cable stock jumps 3% as it expects 20% revenue growth amid strong demand for its cables

A leading cable stock surged nearly 3 percent following the company’s announcement of targeting a 20 percent top-line growth and a significant rise in exports. The company’s focus on expanding its international presence and strengthening its revenue stream is expected to drive strong performance in the coming periods.

Price Action

In Tuesday’s trading session, the share price of KEI Industries Ltd reached an intra-day high of Rs.3,836.90 per share, rising 2.5 percent from its previous close of Rs.3,741.90 per share. However, the stock declined later to Rs.3,800.10 each. Over the past five years, the shares have delivered over 675 percent returns.

Topline Target 

KEI Industries Ltd is seeing robust demand from solar projects within the Indian energy market, leading to a surge in its cables business, which is now outpacing the wire segment. This growth is further supported by the company’s strategic focus on expanding its presence in renewable energy projects.

The company is on track to bring new capacities online by July 2025, with a target of achieving 20 percent top-line growth. Cables will remain a major contributor, accounting for 75 percent of the overall product mix, driving continued momentum in the company’s performance.

International Footprints 

KEI Industries has a strong global presence, exporting its products to around 60 countries. The company is supported by a vast network of over 5,000 channel partners worldwide, which helps drive its international reach and market penetration.

Exports are expected to rise significantly, from 11-12 percent to 18-20 percent by FY26-27, providing a strong boost to the company’s margins. This increase in export activity will not only diversify the revenue streams but also enhance profitability as international markets contribute a larger share to overall sales, strengthening the company’s competitive position.

Also read: Maharatna stock jumps after JV with Assam Power Corp for renewable energy projects

Financial Performance

KEI Industries Ltd’s financial performance for Q3 FY25 showed significant growth, with revenue reaching Rs.2,467 crore, marking a 20 percent increase from Rs.2,059 crore in the corresponding quarter of the previous year. Additionally, the company’s Profit After Tax (PAT) surged by 10 percent, rising to Rs.165 crore from Rs.151 crore in the same period last year.

Ratio Analysis

The company has a Return on Capital Employed (ROCE) of 23.41 percent and a Return on Equity (ROE) of 18.05 percent. Its Price-to-Earnings (P/E) ratio stands at 55.95, higher than the industry average of 45.4. Furthermore, the company maintains a solid current ratio of 1.54, a debt-to-equity ratio of 3.45, and an Earnings Per Share (EPS) of Rs.66.83.

Business Overview

KEI Industries offers a diverse range of cables, including Extra-High Voltage (EHV), High Tension (HT), Low Tension (LT), control and instrumentation, and specialty cables. In addition, the company provides EPC services for various projects, such as gas-insulated and air-insulated substations, power transmission and distribution systems, and railway electrification.

Written by – Siddesh S Raskar

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