Dynamic Cables Limited — Q4 FY26 earnings call

Call held 12 May 2026

Management summary

Dynamic Cables reported a strong Q4 FY26 with highest-ever revenue and profitability for the full year, driven by improved operating leverage and a strategic shift towards higher-margin products. Despite softer overall Q4 growth and project delays due to external factors, the company maintains a robust order book and expects new capacities by September 2026. Management emphasized disciplined execution and prudent financial management, with a focus on long-term growth opportunities.

Highlights

  • Achieved highest-ever revenue and profitability for FY26, with full-year revenue growth of 17% YoY.

  • Q4 operating profit increased by 23% to INR 130 crores, and PAT rose by 30% to INR 84 crores, driven by improved operating leverage and product mix.

  • Operating margin improved to 10.8% in Q4, reflecting enhanced operational efficiency.

  • Order book stands strong at INR 808 crores as of March 31, 2026, providing good revenue visibility.

  • Strategic shift to higher-margin core products, discontinuing low-value conductors and railway signaling cables.

Concerns

  • Overall Q4 revenue growth was softer at 7%, compared to 20% for core products, due to discontinuation of low-value products.

  • Project implementation for new capacity faced delays due to regulatory approvals, Iran war-related logistics impacting imported machinery, and AERB compliance.

  • Raw material price volatility (aluminium, PVC) in March led to deferment of order bookings and supplies, impacting Q4 growth.

  • Net debt increased quarter-on-quarter, though management attributed it to seasonal working capital needs and noted a reduction in specific 'on-books debt' from INR 66 crores to INR 40 crores.

Key financials

2 periods

Q4

  • Operating Profit
    ₹130 Cr
    YoY +23%
  • Operating Margin
    10.8%
  • Profit After Tax
    ₹84 Cr
    YoY +30%
  • Core Product Growth
    20%
  • Overall Revenue Growth
    7%
  • Realization Growth
    12%
  • Core Product Volume Growth
    8%

FY26

  • Revenue Growth
    17%

What they filed

Q1 FY27: revenue up 33.2%, net profit up 38.9% against the same quarter last year.

₹ Cr · quarterly
Line itemQ2 FY25Q3 FY25Q4 FY25Q1 FY26Q2 FY26Q3 FY26Q4 FY26Q1 FY27
Revenue234 252 331 262 282 +21%299 +19%355 +7%349 +33%
EBITDA24 26 34 27 31 +29%34 +31%38 +12%38 +41%
Net profit14 16 24 18 20 +43%22 +38%24 +0%25 +39%
How to read this

₹ crore, as filed. The percentage beside a figure is the change against the same quarter a year earlier — never the quarter before, which would make every seasonal business look like it collapses and booms each year.

Segment breakdown

  • Customer-wise Contribution (FY26)
    13% Government Sales80% Private Sales7% Export Sales
  • Product-wise Contribution (FY26)
    64% HV Cable30% LV Cable6% Conductor
  • Solar Cables Contribution
    18% FY26 Share10% FY25 Share₹105 Cr FY25 Value

Order book

high confidence

Total value

₹808 Cr

as of 2026-03-31 quantified

11% YoY

Execution

providing strong revenue visibility

Composition

Mix 3 products
  • HV Cable 64%
  • LV Cable 30%
  • Conductor 6%

Share of order book by product

Cancellations & deferrals

  • deferred: Deferment of order booking and sales due to sudden spike in raw material prices (aluminium and PVC) in March.
Order book growth was impacted by raw material price volatility leading to customer deferments, but the company has strong revenue visibility.

Source: Prepared remarks

Capital allocation

medium confidence
  • Capex ₹40 Cr
    • Greenfield plant setup for capacity expansion ₹40 Cr
    Okay. so, for the greenfield I believe you did capex of roughly INR40 crores odd and for that you were guiding 6x turnover last in last quarter, in last-to-last quarter maybe? ... Right.
  • Debt Debt disclosed
    • Other Net debt increased quarter-on-quarter due to seasonal working capital borrowings, but on-books debt reduced from INR 66 crores to INR 40 crores.
    My next question is on the net debt. As you have clarified in the press release, it has jumped up significantly quarter-on-quarter... the entire borrowing which you look at is our working capital borrowings. So it all depends on the seasonality. March is a heavy quarter for all the cable manufacturers and so there has been a slight increase of debt in our books. And also if you look at our on-books debt, it has kind of reduced from INR66 crores to INR40 crores.

Guidance & targets

Growth

  • Long-term growth rate Growth · medium to long term · High confidence 18% to 20%
    we have always been giving a long-term guidance of 18% to 20% growth, which we have also delivered in the past and we still believe that for a medium to long term, the company will deliver the same kind of growth in future also.

    — Ashish Mangal

Capacity

  • New plant production start Capacity · September '26 · High confidence September 2026
    the new plant is going to start its production in September '26. September '26 it will start the production.

    — Ashish Mangal

  • Optimal capacity utilization Capacity · High confidence 85% to 90%
    we should be able to optimally utilize around 85% to 90% of our capacities.

    — Ashish Mangal

Efficiency

  • Average asset turn Efficiency · future · High confidence six times
    We have been able to our average asset turn has been around six times. So that is the guidance which I can give you for future also.

    — Ashish Mangal

Export

  • Export share of revenue Export · medium to long term · High confidence 10% to 15%
    our export share on a long-term basis should hit 10% and should increase to 15% kind of level in the medium to long term.

    — Ashish Mangal

Product Mix

  • Solar cables contribution Product Mix · Medium confidence 20% to 23%

    Previously 18% → 20% to 23%

    from 18% it can go up to anywhere between 20% to 23% kind of should be the incremental share which should come.

    — Ashish Mangal

New Initiative

  • TS Conductor Corp product approval timeline New Initiative · within a year · High confidence around a year
    all that process will take around a year's time.

    — Ashish Mangal

  • B2B wire business margins and ROCE New Initiative · High confidence similar to existing business
    Margins and ROCE profile would be similar to what your existing business does? ... it should remain same.

    — Ashish Mangal

What to watch in Q1 FY27

New plant commissioning

Q2 FY27 (September 2026)
Current Project implementation ongoing, delayed
Target Production start in September 2026

Why it matters

Crucial for future capacity and growth, especially for H2 FY27, and to meet long-term growth targets.

the new plant is going to start its production in September '26. September '26 it will start the production.

Risks & concerns

  • Raw material price volatility

    high

    Sudden spike in aluminium and PVC prices in March led to deferment of orders, though company has pass-through mechanisms.

    Management acknowledged

  • Project implementation delays for new capacity

    medium

    Delays due to regulatory approvals, Iran war-related logistics impacting imported machinery, and AERB compliance.

    Management acknowledged

  • Competitive intensity in low-value product segments

    low

    High competitive intensity in railway signaling and low-value conductors led to their discontinuation to focus on higher-margin products.

    Management addressed by strategic shift

Q&A highlights

8 direct
Softer Q4 growth and volume vs. realization breakdown Direct
in Q4, our core product growth has been 20%, whereas the growth which we see in overall growth of 7% during the quarter. The largely the difference between 7% and 20% is basically our low value-add low voltage conductors and railway signaling cables, which we have discontinued this year. ... for the quarter, 12% is the realization growth and 8% volume growth for the core products.

Clarifies the reported lower overall growth by explaining the strategic discontinuation of low-value products and provides a breakdown of core product growth (20%), realization (12%), and volume (8%).

Asked by Piyush Sevaldasani

Delay in capex implementation and FY27 growth outlook Direct
there has been a delay in the capex... the new plant is going to start its production in September '26... H1 growth we will be managing from our existing facility. So, this is the growth color, I mean this is the growth outlook which we can give as of today.

Addresses concerns about project delays, provides a revised timeline for new capacity, and outlines the strategy for managing growth in the interim.

Asked by Piyush Sevaldasani

Weakness in order book growth Direct
because of this price volatility, so in typically in the industry there is some deferment of order booking or kind of sales booking or order booking when there is such a sudden increase in our raw material prices. So you, we all know what has happened in the month of March, and so there has been a deferment of order booking from March, in the month of March because of the sudden spike in the prices of aluminium and PVC, which are our key raw materials.

Explains the reason for slower order book growth, linking it to raw material price volatility and subsequent deferment of orders by customers.

Asked by Piyush Sevaldasani

Significant increase in net debt Direct
the entire borrowing which you look at is our working capital borrowings. So it all depends on the seasonality. March is a heavy quarter for all the cable manufacturers and so there has been a slight increase of debt in our books. And also if you look at our on-books debt, it has kind of reduced from INR66 crores to INR40 crores. So nothing to kind of, it's a very routine kind of thing which happens.

Clarifies that the increase in debt is primarily due to seasonal working capital requirements and that actual on-books debt has reduced, alleviating concerns about financial leverage.

Asked by Nitin Jain

Gross margin drop despite pass-through mechanisms Direct
you have to look at the operating profit level because there are lot of components which go by in the at the gross level. So there can be 1% or 2% variation on a quarter-on-quarter basis... our original conversation that most of our orders are having price variation clause and it is a pass-through to our customers.

Reaffirms the company's ability to pass on raw material costs and emphasizes focusing on operating profit as a more stable indicator than gross margin, which can fluctuate due to product mix.

Asked by Nitin Jain

Strategic tie-up with TS Conductor Corp Direct
it is basically stepping stone or basically a starting step to venture into this high voltage conductor market for our company... it is a very niche I mean a futuristic product and which would be adopted by the utilities as a solution to this vertical expansion in the power infrastructure.

Introduces a new strategic initiative to enter the high-voltage conductor market with a niche, futuristic product, indicating future growth avenues.

Asked by Pranav Jain

Reasons for the significant delay in the new plant commissioning Direct
there are three major reasons for the delay. One is that there were some government, basically regulatory body approvals which were delayed... secondly, there were some import machineries which got delayed because of this freight-related issues of late after this Iran war. And thirdly, there are some, compliance requirements which from the AERB Board.

Provides a clear, detailed explanation for the project delays, addressing investor concerns about execution timelines.

Asked by Yash

Re-exploring the US export opportunity Direct
US market has to we are re-establishing our links with the distributors because it is completely distributor-led market... now when the tariffs have gone away and now there is some policy stability in the US from the US government, we are trying to re-establish our US connects and with the distributors and trying to basically we have to start afresh in in terms of our go-to-market strategy.

Details the company's renewed efforts to re-enter the US market after overcoming tariff-related disruptions, indicating potential for future export growth.

Asked by Nitin Jain

3 min read 7 chapters

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.

This is an AI-generated summary of a publicly available earnings call transcript.
View original transcript

More Capital Goods earnings calls