Organised cables and wires manufacturers are expected to post a successive mid-teen growth next fiscal, building on an estimated 16 per cent increase in FY25, stated a report by Crisil Ratings. This, it added, will be on the back of rising investment in end-user segments such as power generation and transmission, railways and real estate in domestic markets (90 per cent of revenues) and a leg-up from the China+1 strategy being implemented by some of the countries.
With capacity utilization reaching 80-85 per cent in fiscal 2024 and strong growth prospects ahead, capital expenditure (capex) saw a around 70 per cent year-on-year surge in fiscal 2025 and is expected to maintain its momentum in fiscal 2026.
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That said, the Crisil report said, healthy cash flows, supported by a stable operating margin of 10-11 per cent on a significantly larger revenue base, will keep the credit profiles of players stable.
Crisil Ratings analysed 13 cables and wires players, accounting for 60-65 per cent of the organised sector’s revenue of Rs 80,000-82,000 crore, to release the findings.
Mohit Makhija, Senior Director, Crisil Ratings Ltd, said, “Cables and wires demand will grow, as India’s combined spend on power, railways and real estate is expected to rise 25 per cent to ~Rs 9 lakh crores in fiscal 2026. This includes 45-55 GW addition in power generation capacity, investments in 10,000 line KM of inter-state transmission systems and capex in railways, metro expansion projects and real estate. Together this is estimated to generate a wires and cables demand of ~Rs 20,000 crore for fiscal 2026.”
With the organized players catering to two thirds of the aforementioned demand, their revenue from the domestic segment is expected to grow at a healthy 15.
Meanwhile, exports will grow at a stronger 20-22 per cent, benefiting from the China+1 supplier diversification of Western countries, including the United States (US) and Europe, which together account for 45-55 per cent of exports. Per the Crisil report, Indian players are being increasingly preferred over their Chinese counterparts owing to their expanding product range and adherence to global quality standards.
Shounak Chakravarty, Director, Crisil Ratings Ltd, said, “Driven by promising growth prospects, Indian players are expected to boost installed capacities by ~40 per cent incurring capex of Rs 8,000-8,500 crore 2025-2026 – a 70 per cent step-up over capex incurred between fiscals 2022 and 2024.
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