Priyanka Tiwari
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Following a recent meeting with KEI Industries’ management, it’s clear that the company remains optimistic about demand trends and its medium-term growth trajectory. Demand for cables continues to be robust, driven by higher government capital expenditure. Wire demand is also improving, supported by the revival in real estate activity and elevated copper prices, which have prompted greater inventory stocking.
Revenue Growth and Capacity Expansion
KEI has reaffirmed its revenue growth targets at approximately 18% for FY25E and FY26E, and around 20% for FY27E. The company is increasing production capabilities through brownfield expansions and a greenfield facility in Sanand, Gujarat. These efforts align with rising demand across power transmission, industrial infrastructure, real estate, and the data center sector.
Operational Strategy and Market Positioning
The company continues to invest in backward integration to secure supply chains and enhance cost control. It is also focused on strengthening its retail footprint and optimizing its product mix to tap into evolving market opportunities.
Valuation Impact and Competition Concerns
Despite a strong business outlook, EPS estimates for FY26 and FY27 have been revised downward by ~4% and ~8%, respectively, due to margin concerns and raw material cost volatility stemming from recent U.S. tariff announcements. KEI shares have corrected by ~25% over the last month amid news of new entrants like Ultratech Cement (UTCEM) and the Adani Group entering the cables and wires segment.
Stock Rating and Target Price
KEI Industries currently trades at 33x/28x its FY26E/27E EPS. Analysts have maintained a Neutral rating on the stock and set a target price of INR 3,000, valuing it at 32x FY27E EPS.
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