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    KEI Industries

    KEI
    Capital Goods·16 Oct 2025
    Management Summary

    KEI Industries delivered a strong Q2 FY26, with robust growth in net sales, EBITDA, and PAT, driven significantly by exceptional export performance and EHV cable sales. Despite delays in the Sanand plant expansion, management remains confident in exceeding annual growth guidance and maintaining healthy margins. The company continues to focus on market diversification and capacity utilization to sustain its growth trajectory.

    Highlights

    5
    • Net sales for Q2 FY26 reached INR 2,726 crores, marking a 19.38% YoY growth.

    • EBITDA for Q2 FY26 stood at INR 311.63 crores, a 31.2% increase YoY, with EBITDA margin expanding to 11.43% from 10.4% in the prior year.

    • Profit After Tax (PAT) for Q2 FY26 was INR 203 crores, representing a 31.47% YoY growth, and PAT margin improved to 7.4%.

    • Export sales achieved an all-time high of INR 472 crores in Q2 FY26, demonstrating a significant 96% YoY growth.

    • Domestic Institutional Extra High-Voltage (EHV) Cable sales grew 76% YoY in Q2 FY26 to INR 128 crores.

    Concerns

    3
    • Phase 1 of the Sanand plant expansion is delayed by approximately 4 months, now expected to be operational by November '25.

    • Phase 2 of the Sanand plant, primarily for EHV and MV cables, is delayed by approximately 9 months due to construction complexities.

    • EPC division sales (other than Cable) declined to INR 47 crores in Q2 FY26 from INR 80 crores in the previous year.

    Key financials

    Metrics

    10

    Periods

    2

    Q2 FY26

    5
    • Net Sales
      ₹2,726 Cr
      YoY+19.4%
    • EBITDA
      ₹311.63 Cr
      YoY+31.2%
    • EBITDA Margin
      11.4%
    • PAT
      ₹203 Cr
      YoY+31.5%
    • PAT Margin
      7.4%

    H1 FY26

    5
    • Net Sales
      ₹5,316 Cr
      YoY+22.3%
    • EBITDA
      ₹609 Cr
      YoY+29.6%
    • EBITDA Margin
      11.5%
    • PAT
      ₹399.26 Cr
      YoY+30.9%
    • PAT Margin
      7.5%

    Segment breakdown

    Wire and Cable Segment
    22% Growth (Q2 FY26)15% Volume Growth (Q2 FY26)
    Domestic Institutional Cable Sales
    ₹581 Cr Revenue (Q2 FY26)₹1,292 Cr Revenue (H1 FY26)9% Growth (H1 FY26)
    Domestic Institutional Extra High-Voltage Cable Sales
    ₹128 Cr Revenue (Q2 FY26)76% Growth (Q2 FY26)₹244 Cr Revenue (H1 FY26)61% Growth (H1 FY26)
    Export Sales
    ₹472 Cr Revenue (Q2 FY26)96% Growth (Q2 FY26)₹846 Cr Revenue (H1 FY26)79% Growth (H1 FY26)
    Sales through Dealer Network (B2C)
    ₹1,475 Cr Revenue (Q2 FY26)17% Growth (Q2 FY26)₹2,800 Cr Revenue (H1 FY26)20% Growth (H1 FY26)
    EPC Division (other than Cable)
    ₹47 Cr Revenue (Q2 FY26)
    Stainless Steel Wire
    ₹53 Cr Revenue (Q2 FY26)
    List

    Order Book

    high confidence

    Total Value

    ₹ 3,824 crores

    as of 2025-09-30

    quantified

    Execution

    Cable orders executed within 4 months, EPC orders within 18 months.

    Composition

    Mix2 products
    • EPC order book12.7%
    • Extra high-voltage power cable16.6%

    Share of order book by product · partial disclosure (29.3% of book)

    "There is strong demand for wires and cables, with strong growth in both exports and domestic markets, though some domestic capacity was shifted to exports."

    Source:
    Prepared remarks

    Capital allocation

    1
    medium confidence
    CategoryHeadline
    Capex

    ₹1,000 crores

    Guidance & targets

    8
    CategoryTargetPriority
    Revenue
    FY26 Revenue Growth
    >20%
    High
    Revenue
    CAGR Growth
    20% plus
    High
    Capacity
    Sanand Plant Total Revenue Potential
    INR 6,000 crores
    High
    Capacity
    Sanand Phase 1 Revenue Contribution
    INR 3,000 crores
    High
    Profitability
    EBITDA Margin Expansion
    1% to 1.5%
    High
    Sales Mix
    Export Sales Contribution
    18%
    High
    Sales Mix
    B2C vs Institutional Sales Mix
    50%-50%
    High
    EPC
    EPC Segment Sales
    INR 400-500 crores
    High

    Sanand Phase 1 Commercial Production

    next quarter
    CurrentTrial runs started, expected operational by November '25
    TargetCommercial production commenced

    Why it matters

    Crucial for adding significant capacity (50% of total Sanand capacity) and contributing to revenue from Q4 FY26 onwards.

    As soon as our new capacities, our new first phase of Sanand is operational by November '25, more than 50% of the capacity will come on board from December and which will add significant growth from fourth quarter onwards from Sanand to our existing operations.

    How to verify

    detailed_narrative[title='Sanand Expansion and Capacity Outlook']

    Risks & concerns

    3
    RiskSeverity

    Sanand Plant Phase 1 Delay

    Phase 1 delayed by 4 months due to heavy rains in Gujarat and labor shortages, now expected operational by November '25.Management acknowledged

    medium

    Sanand Plant Phase 2 Delay

    Phase 2 delayed by 9 months due to complexities in constructing a 158-meter vertical tower for EHV/MV cable production.Management acknowledged

    medium

    US Export Tariff Uncertainty

    Export to the US, which contributed INR 160 crores last year, is currently impacted by tariff uncertainty, with recommencement expected post resolution.Management acknowledged

    medium

    Q&A highlights

    8

    “The first phase delay is close to 4 months. It is mainly because of the challenges faced during increased tenure of rains in Gujarat and also challenges from the contractor side because of the labor shortages. But now the first phases, which contributes more than 50% to the capacity of the total plant will be operational definitely by in November.”

    Addresses concerns about project delays and their impact on future growth, with management confirming revised timelines and confidence in exceeding annual guidance despite delays.

    asked by Natasha Jain

    2 min read5 chapters

    Detailed Narrative

    01

    Q2 FY26 Performance Overview

    KEI Industries reported strong financial results for Q2 FY26, with net sales growing 19.38% YoY to INR 2,726 crores. The Wire and Cable segment, a key driver, saw a 22% growth, with volume contributing 15% and pricing the remainder. EBITDA increased by 31.2% to INR 311.63 crores, leading to an EBITDA margin expansion to 11.43% from 10.4% in the previous year. PAT also saw robust growth of 31.47% YoY, reaching INR 203 crores, with PAT margin improving to 7.4%.

    02

    Sanand Expansion and Capacity Outlook

    The company's Sanand plant expansion is progressing, though with some delays. Phase 1, representing over 50% of the total capacity, is now expected to be operational by November '25, a 4-month delay due to heavy rains and labor shortages. Phase 2, focusing on EHV and MV cables, is delayed by 9 months due to complex vertical tower construction. Once fully operational, the Sanand project is estimated to generate INR 6,000 crores in revenue, with INR 3,000 crores expected from Phase 1 contributing from Q4 FY26 onwards. The capacity mix from Sanand is projected to be INR 1,200 crores for EHV and INR 4,800 crores for LV/MV power cables.

    03

    Segmental Performance and Growth Drivers

    Domestic Institutional Cable sales in Q2 FY26 were INR 581 crores, with Extra High-Voltage Cable sales growing significantly by 76% YoY to INR 128 crores. Sales through the dealer network (B2C) increased by 17% to INR 1,475 crores, maintaining a 54% contribution to total sales. The EPC division (excluding cable) experienced a decline to INR 47 crores from INR 80 crores in the prior year, though management aims to maintain annual EPC sales between INR 400-500 crores. The company's total active dealer network stands at 2,100.

    04

    Export Strategy and Market Diversification

    Exports emerged as a significant growth driver, achieving an all-time high of INR 472 crores in Q2 FY26, a 96% YoY increase. Management emphasized its strategy of diversifying into new geographies to utilize upcoming capacities, with exports primarily directed to Australia, the Middle East, and Africa. The company also noted its presence in Europe and the US, with US exports reaching INR 160 crores last year, though currently impacted by tariff uncertainties. The target for export contribution to total sales is set at around 18% for FY27.

    05

    Margin Stability and Future Outlook

    KEI Industries maintained strong profitability, with Q2 FY26 EBITDA margin at 11.43% and PAT margin at 7.4%. Management stated that margins have remained stable over the last 15 years due to price variation clauses in B2B orders and regular revisions in retail pricing. They anticipate a 1% to 1.5% margin expansion once the entire Sanand capacity is commissioned, driven by economies of scale. The company reiterated its guidance for over 20% revenue growth for FY26 and a 20% plus CAGR for the next 3-5 years, driven by strong demand from the energy sector, infrastructure, and real estate.

    This is an AI-generated summary of a publicly available earnings call transcript. It is for informational purposes only and does not constitute investment advice, a recommendation, or an endorsement. inve.money is not a SEBI-registered investment advisor. Please consult a qualified financial advisor before making any investment decisions.