KEI - KEI Industries

📊 NSE: KEI 🏢 Cables - Power 📅 Last Updated: 12/14/2025 8:52

💰 Financial Performance

Revenue Growth by Segment

Total Operating Income (TOI) grew 19.89% YoY to INR 9,735.88 Cr in FY25. Retail segment revenue reached INR 5,088 Cr (52% of total), growing 35% YoY. Institutional sales were INR 3,412 Cr (35% of total), growing 3% YoY. Export sales reached INR 1,264 Cr (13% of total), growing 15% YoY. Housing wires grew 26% and the overall cable segment grew 24% in FY25.

Geographic Revenue Split

Domestic sales are distributed across North (38-39%), West (26-28%), South (18%), and East (16-17%). Exports contributed 13% of total revenue in FY25, up from 10% in FY24, with recent forays into the US and European markets.

Profitability Margins

PAT margin improved to 7.17% in FY24 from 6.90% in FY23. Net margins remained stable at 7.2% in FY25. Operating profit margins (OPM) are expected to be maintained at 10-10.5% due to a shift toward high-margin retail and export segments.

EBITDA Margin

PBILDT margin stood at 10.03% in FY25, a slight moderation from 10.40% in FY24 due to increased copper prices. The company expects a 25-30 bps improvement annually in the medium term as it curtails the lower-margin EPC business (currently ~4% of sales).

Capital Expenditure

Planned capex of INR 1,600-1,800 Cr over FY26-FY27. This includes INR 1,100 Cr in FY26 and INR 500 Cr in FY27 for the Sanand greenfield project, plus a INR 65 Cr brownfield expansion at Chinchpada. Funding is sourced from INR 1,379 Cr of unutilized QIP proceeds and internal accruals.

Credit Rating & Borrowing

Long-term bank facilities rated CARE AA+; Stable; Short-term facilities rated CARE A1+. Interest coverage ratio remains strong at 17.54x in FY25. Total debt to PBILDT improved to 0.48x in FY25 from 0.80x in FY24.

⚙️ Operational Drivers

Raw Materials

Primary raw materials include copper, aluminum, PVC, DOP, stainless-steel strips/rods, and G.I. wires. Raw materials constitute approximately 75-77% of total operating costs.

Import Sources

Not specifically disclosed by country, but the company manages imports of metals which are partially offset by export earnings to create a natural hedge.

Key Suppliers

Not disclosed in available documents; referred to as established relationships with reputed vendors.

Capacity Expansion

Current capacity utilization is at an optimum level of ~80% (moderated from 90% in FY24 due to brownfield additions). Planned greenfield expansion at Sanand for LT, HT, and EHV cables to support 12-15% annual growth.

Raw Material Costs

Raw material costs represent 75-77% of total costs. The company maintains 2-2.5 months of inventory with fixed pricing to insulate against price volatility. Most price hikes are passed to customers, especially in the retail segment where prices are revised every 15 days.

Manufacturing Efficiency

Capacity utilization at 80% across major segments. Efficiency is driven by brownfield expansions and the transition to a higher-margin product mix (Retail and EHV).

Logistics & Distribution

Distribution is managed through a pan-India network of 2,082 dealers as of March 2025, up from 1,925 in March 2023.

📈 Strategic Growth

Expected Growth Rate

14-15%

Growth Strategy

Growth will be achieved by increasing the retail revenue share to 50-55%, expanding export contribution to 15-18% over 3 years, and leveraging the new Sanand facility for EHV (Extra High Voltage) and HVDC capabilities. The company is also curtailing its low-margin EPC business to focus on high-margin cable manufacturing.

Products & Services

Low Tension (LT) cables, High Tension (HT) cables, Extra High Voltage (EHV) cables, Housing wires, Stainless Steel (SS) wires, and EPC project services (primarily EHV).

Brand Portfolio

KEI

New Products/Services

Expansion into EHV and HVDC capabilities at the Sanand plant; foray into US and European markets for specialized cable exports.

Market Expansion

Targeting 15-18% export share by leveraging US and European market entries. Expanding domestic retail footprint via 2,082 dealers and 15,000+ retailers.

Market Share & Ranking

Established leader in the EHV cable segment; one of the top players in the organized wires and cables industry.

🌍 External Factors

Industry Trends

The industry is shifting toward organized players due to high gestation periods for plants and distribution. Demand is driven by the National Infrastructure Pipeline, Metro Rail, and the PLI scheme for manufacturing.

Competitive Landscape

Intense competition from Polycab, Havells, Finolex, V-Guard, and RR Kabel. New entry threats from large groups like Adani and Birla.

Competitive Moat

Moat consists of a 50-year track record, a massive 2,082-dealer network, and high technical barriers in EHV cables where new players take 7-8 years to qualify. These are sustainable due to the long gestation period for setting up competing infrastructure.

Macro Economic Sensitivity

Highly sensitive to infrastructure spending, urban/rural electrification, and private capex in sectors like steel, cement, and real estate.

Consumer Behavior

Increasing demand for branded housing wires in the retail segment, supporting the company's 35% growth in retail sales.

Geopolitical Risks

Global economic conditions and geopolitical tensions pose challenges to the 13% export business, though US/Europe forays provide diversification.

⚖️ Regulatory & Governance

Industry Regulations

Operations are influenced by government infrastructure policies, the Production-Linked Incentive (PLI) scheme, and international product clearances (e.g., US market approvals received in 2023).

Environmental Compliance

Focus on zero-discharge facilities, use of renewable energy, and replacing wooden drums with steel drums to conserve natural resources.

⚠️ Risk Analysis

Key Uncertainties

Volatility in copper prices (impacted FY25 margins), potential delays in the Sanand greenfield project, and heightened competition from new large-scale entrants.