Detailed Narrative
Q4 FY26 Performance Overview
Dynamic Cables reported a healthy financial performance for Q4 FY26, achieving its highest-ever revenue and profitability for the full financial year. Revenue grew by 17% year-on-year for FY26. In Q4, operating profit increased by 23% to INR 130 crores, with the operating margin improving to 10.8%. Profit after tax for the quarter rose by 30% to INR 84 crores, reflecting disciplined execution and a better product mix.
Product Mix and Strategy Shift
The company has strategically shifted its focus towards core value-added products, discontinuing low-value-add low voltage conductors and railway signaling cables. This shift resulted in Q4 core product growth of 20%, while overall growth was 7%. The contribution of low voltage conductors to total revenue is now below 5%, down from 8-9% in FY25, with a 50-60% volume decrease. This strategy aims to improve profitability and operating performance by dedicating capacity to higher-margin products.
Capacity Expansion and Project Delays
Project implementation for the new greenfield plant, with an estimated capex of INR 40 crores, has faced delays. Reasons include regulatory body approval timelines, disruption in imported machinery deliveries due to Iran war-related logistics, and AERB compliance requirements. The new capacities are now expected to commence production in September 2026, ahead of the seasonally stronger second half of FY27. Management expects to manage H1 FY27 growth from existing facilities.
Order Book Dynamics and Raw Material Impact
As of March 31, 2026, the order book stands at INR 808 crores, providing strong revenue visibility. However, order book growth was noted to be around 11%, attributed by management to raw material price volatility. A sudden spike in aluminium and PVC prices in March led to deferment of order bookings and supplies. Despite this, management noted a gradual acceptance of higher raw material prices in the market.
Capital Structure and Financial Discipline
Net debt increased quarter-on-quarter, which management attributed to seasonal working capital borrowings, as March is a heavy quarter for cable manufacturers. However, the company also reported a reduction in its specific 'on-books debt' from INR 66 crores to INR 40 crores. Management does not anticipate a jump in finance costs going forward⏳, emphasizing continued financial discipline and lower interest charges due to credit rating enhancement.
New Initiatives: TS Conductor and B2B Wire Business
Dynamic Cables announced a strategic tie-up with TS Conductor Corp, marking its entry into the high-voltage conductor market. This niche, futuristic product, utilizing carbon core technology, is expected to take about a year for product approvals and type testing. The company also plans to expand its B2B wire business, leveraging existing relationships and institutional supply capabilities, expecting similar margins and ROCE profiles to its current operations.
Export Market Strategy
Export sales contributed 7% to FY26 revenue, experiencing a slight degrowth compared to FY25. The company's US market entry plans were previously delayed due to tariff problems but are now being re-established. With tariffs removed and policy stability, Dynamic Cables is working to reconnect with distributors and rebuild its go-to-market strategy in the US. The long-term target is to increase export share to 10-15% of overall revenue.