KEI Industries reported a 23% year-on-year growth in net sales for Q1 FY27, reaching INR 3,185 crores. The company highlighted a 40% increase in Profit After Tax (PAT) to INR 274 crores. Management expressed optimism for sustained growth, targeting a 20% plus CAGR, supported by significant capital expenditure plans, including INR 600-700 crores annually for the next 3-4 years. Export performance was impacted by geopolitical issues but is expected to recover.
KEI Industries Reports Strong Q1 FY27 Performance
KEI Industries Limited announced its financial results for the first quarter of FY27 (ended June 30, 2026), showcasing robust growth across key metrics. Net sales surged by 23% to INR 3,185 crores, compared to INR 2,590 crores in the prior year period. The wire and cable segment exhibited a strong performance with a growth of 24.4%. Operating margins improved to 12.43%, driven by favorable product mix and operational efficiencies. Consequently, EBITDA rose by 39.5% to INR 415 crores, with EBITDA/sales margin at 13.04%. Profit After Tax (PAT) saw a significant jump of 40% to INR 274 crores, resulting in a PAT/net sales margin of 8.61%.
Segmental Performance and Export Outlook
Domestic wire and cable sales grew by 29% to INR 2,784 crores. However, export sales were impacted by non-dispatches due to geopolitical events, declining to INR 341 crores from INR 375 crores in the previous year. Management anticipates a substantial recovery and growth in exports for the full year, aligning with earlier guidance. Sales of extra high-voltage (EHV) cables increased by 47% to INR 186 crores. The contribution of sales through the distribution network (D2C) stood at 59%, with the company having 2,128 active dealers.
Order Book and Financial Position
The company’s pending order book stands at INR 4,292 crores, with EPC orders at INR 271 crores, EHV cables at INR 793 crores, domestic cables at INR 2,400 crores, and export orders at INR 822 crores. KEI Industries maintains a strong financial position with cash and bank balances of INR 1,054 crores as of June 30, 2026. The company has raised INR 2,000 crores through QIP and has utilized INR 1,785 crores up to the quarter end.
Capital Expenditure and Future Growth Strategy
KEI Industries incurred capital expenditure of INR 191 crores in Q1 FY27, with INR 180 crores allocated to the Sanand project. The company plans to invest approximately INR 600 crores to INR 700 crores annually for the next 3 to 4 years, indicating a strong focus on capacity expansion and future growth. The Sanand plant is expected to ramp up production, with Phase 1 reaching 50% utilization and contributing INR 1,500 to INR 2,000 crores in revenue in the current financial year. Management is confident in achieving a 20% plus CAGR, driven by strong demand in domestic and overseas markets across sectors like power, infrastructure, and renewables.
Market Outlook and Competitive Positioning
The company expressed a bullish outlook on the market, citing strong demand in the housing sector, commercial spaces, data centers, electric vehicles, and renewable energy projects. Management highlighted efforts to improve margins through product mix enhancement and operational efficiencies, aiming for 11-12% operating margins. The company’s disciplined approach to capital allocation and risk mitigation, coupled with its debt-free status, positions it well for sustainable long-term growth. They are focused on expanding capacity and revenue while maintaining a conservative growth guidance of 20% plus CAGR.
Source: BSE
