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UltraTech Cement on Tuesday announced that it proposes to extend its presence in the construction value chain with a foray into the wires and cables segment through a capex of ₹1,800 crore over a two-year period.
India’s wires and cables industry has witnessed its revenue Compounding at an annual growth rate of nearly 13% over financial year 2019 to 2024. UltraTech could also be better placed in sourcing raw materials like Copper and Aluminium from group companies like Hindalco.
Brokerage firm Jefferies has said that any knee-jerk negative reaction in UltraTech should be used as a buying opportunity. It maintained its “buy” rating with a price target of ₹13,265.
Wires and cables peers like Polycab, Havells among others have also corrected significantly from their recent peaks amidst the ongoing broader markets sell-off.
During its recent quarterly results, Polycab mentioned that it will achieve its ₹20,000 crore annual revenue target in financial year 2025 itself, a year ahead of its initial guidance of financial year 2026.
Here’s how much these stocks have corrected from their highs:
| Stock | Fall From Highs |
| Polycab | -25% |
| Havells | -27% |
| KEI Industries | -25% |
| RR Kabel | -41% |
| Finolex Cables | -47% |
Jefferies said that assuming a 4-5x asset turnover, UltraTech’s revenue potential can be between 5% to 7% of the cables & wires industry in financial year 2029. It also sees a lower competitive impact on Polycab.
Morgan Stanley also said that it is “surprised” at the move but is not concerned for its cables & wires coverage of Polycab, Havells and KEI as there are differences in the cables & wires business compared to paints.
Shares of UltraTech Cement ended 0.8% lower on Tuesday at ₹10,950. Shares of India’s largest Cement company have also corrected 10% from their peak of ₹12,145.
First Published: Feb 27, 2025 6:27 AM IST
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