KEI Industries Limited — Q4 FY26 earnings call

Call held 5 May 2026

Management summary

KEI Industries delivered strong financial results for Q4 and full FY26, driven by robust sales growth and margin expansion. The company provided optimistic guidance for FY27 volume growth and maintained healthy EBITDA margins. Despite some capacity constraints and shipping challenges, strategic shifts towards B2C and EHV cables, coupled with re-engagement in the US export market, position KEI for continued growth and improved capital efficiency.

Highlights

  • Full FY26 Net Sales grew 20.66% to ₹11,746 crores, exceeding previous year's ₹9,735 crores.

  • Full FY26 EBITDA margin expanded to 11.81% from 10.92% in the previous year, with EBITDA growing 30.56% to ₹1,387 crores.

  • Q4 FY26 PAT increased by 25.5% to ₹284.31 crores, with PAT margin improving to 8.18% from 7.77%.

  • Domestic institutional extra high-voltage cable sales grew 82% in FY26 to ₹559 crores.

  • Export sales grew 45% in FY26 to ₹1,833 crores, with a target to reach ~20% of total sales in the current FY.

Concerns

  • Q4 FY26 volume growth was limited to 2% due to capacity constraints.

  • Sanand plant commissioning (Phase 1 and Phase 2) experienced a 6-month delay.

  • Shipping problems in March 2026 led to INR 50-60 crores in lost export sales to the Middle East.

Key financials

2 periods

Q4 FY26

  • Net Sales
    ₹3,476 Cr
    YoY +19.3%
  • EBITDA Margin
    12.2%
  • PAT
    ₹284.31 Cr
    YoY +25.5%
  • PAT Margin
    8.2%

FY26

  • Net Sales
    ₹11,746 Cr
    YoY +20.7%
  • EBITDA
    ₹1,387 Cr
    YoY +30.6%
  • EBITDA Margin
    11.8%
  • PAT
    ₹918 Cr
  • PAT Margin
    7.8%
  • Copper Cables Volume Growth
    15%
  • Net Volume Growth
    6.2%

What they filed

Q1 FY27: revenue up 23.0%, net profit up 39.8% against the same quarter last year.

₹ Cr · quarterly
Line itemQ2 FY25Q3 FY25Q4 FY25Q1 FY26Q2 FY26Q3 FY26Q4 FY26Q1 FY27
Revenue2,284 2,472 2,915 2,590 2,726 +19%2,955 +20%3,476 +19%3,185 +23%
EBITDA225 246 301 258 269 +20%320 +30%382 +27%396 +53%
Net profit155 165 227 196 204 +32%235 +42%284 +25%274 +40%
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

Share of Export Sales
₹2,276 Cr Total
  • Full FY26 Sales Mix ₹1,833 Cr 80.5%
  • Q4 FY26 Sales Mix ₹443 Cr 19.5%

Order book

high confidence

Total value

₹3,585 Cr

as of 2026-03-31 quantified

Execution

within 3-4 days or 1 week for dealer distributor orders

Composition

Mix 3 geographies
  • Domestic cable institution ₹2,154 Cr 79.7%
  • Cable export ₹497 Cr 18.4%
  • US Market ₹50 Cr 1.9%

Share of order book by geography, derived from disclosed amounts

Pipeline

L1 awaiting loa

L1 bids for extra high-voltage power cable

The total order book is healthy, with significant contributions from domestic institutional and export segments, excluding dealer network sales which are immediate.

Source: Prepared remarks

Capital allocation

high confidence
  • Capex ₹600 Cr New plan — continuous capacity expansion · 60-70% for capital expenditure, 30-40% for working capital, from internal accruals
    • Incremental capacity addition
    Sir, we will be doing all future capex from the internal accrual only because whatever capex we are accruing year after year, we will be allocating close to 60%, 70% for the capital expenditure for the incremental capacity addition to grow at a CAGR of 20%.
  • Debt Debt disclosed
    Because we are running a debt-free company. And with this guidance, we will be continuing running as a debt-free company for next 4 to 5 years with a top line growth of 20% CAGR
  • Liquidity Cash ₹500 Cr Need to maintain cash at INR 500-600 crores level for operational needs and sudden raw material price jumps.
    So cash will not be there at that time. So because of that, we need to have the cash at INR500 crores to INR600 crores level at any given point of time in the balance sheet.

Guidance & targets

Volume

  • Volume Growth Volume · FY27 · High confidence 17-18%
    We are expecting 17% to 18% volume growth in this current financial year, which will mainly coming from Sanand new facility.

    — Anil Gupta

  • Volume Growth Volume · FY28 · Medium confidence ~20%
    Yes, it will be -- it could be around 20%, yes.

    — Anil Gupta

Margin

  • EBITDA Margin Margin · Current FY · High confidence 10.5-11%
    I mean on a conservative side, we can now expect around 11% -- anywhere between 10.5% to 11%.

    — Anil Gupta

  • EBITDA Margin Improvement Margin · FY27/28 · Medium confidence 0.5%
    So that will be the first year in '27, '28. So another 0.5% EBITDA margin will get improved because of economy of scale.

    — Rajeev Gupta

Export Sales

  • Export Sales Contribution Export Sales · Current FY · High confidence ~20%
    taking our export to around approximately 20% of our total sales in the current financial year

    — Anil Gupta

Dealer Sales

  • Dealer Sales Contribution Dealer Sales · Ongoing · High confidence 53-55%
    So we hope that 53% to 55% contribution from the dealer distributor will remain.

    — Rajeev Gupta

Working Capital

  • Receivable Days Working Capital · Ongoing · High confidence 1.75 months

    Previously 1.88 months → 1.75 months

    It may reduce to 1.75 months.

    — Rajeev Gupta

Capex

  • Annual Capex Capex · Next 2-3 years · High confidence ₹600-700 crores
    every year, we will be doing around INR600 crores to INR700 crores capital expenditure for next 2 to 3 years continuous.

    — Rajeev Gupta

Debt

  • Debt Status Debt · Next 4-5 years · High confidence Debt-free
    we will be continuing running as a debt-free company for next 4 to 5 years with a top line growth of 20% CAGR

    — Rajeev Gupta

Topline Growth

  • Topline Growth CAGR Topline Growth · Next 4-5 years · High confidence 20%
    top line growth of 20% CAGR

    — Rajeev Gupta

Capacity

  • Sanand Phase 2 Commissioning Capacity · Q4 FY27 · High confidence Completed
    The second phase of the extra high-voltage power cable in Sanand will complete by Q4 of the current financial year.

    — Rajeev Gupta

What to watch in Q1 FY27

Sanand Phase 1 Volume Contribution

Q1 FY27
Current Very low (<INR 100 crores) in Q4 FY26
Target Visible contribution from Q1 FY27 onwards

Why it matters

Essential for achieving the guided 17-18% volume growth for FY27.

In Sanand, fourth quarter sale was very less. It was less than INR100 crores because the ramp-up takes time. But now from the first quarter onwards for the current financial year, the sale from Sanand will be visible to that extent.

Risks & concerns

  • Shipping Problems/Geopolitical Impact on Exports

    medium

    Shipping issues in March/April 2026, particularly to the Middle East, led to INR 50-60 crores in lost export sales due to unavailability of shipping lines and increased freight costs.

    Management acknowledged

  • Sanand Plant Commissioning Delays

    medium

    Both Phase 1 and Phase 2 of the Sanand plant experienced 6-month delays, pushing Phase 2 completion to Q4 FY27.

    Management acknowledged

  • Capacity Constraints Limiting Volume Growth

    low

    Q4 FY26 volume growth was constrained by existing capacity, with new Sanand capacity only starting to contribute from Q1 FY27.

    Management acknowledged

Q&A highlights

8 direct
Supply Chain Issues & Freight Costs Direct
Also in March, we witnessed we were not able to ship our goods to Middle East because no shipping line was ready to take the deliveries. Now in April, it has started albeit at a very high cost because the containers are now going to Fujairah and from Fujairah port by land to various destinations in Abu Dhabi and Qatar etcetera, in other countries. So it is a - and in most of the customers are bearing 50% of the differential freight cost from us.

Highlights external risks (geopolitical/logistics) impacting exports and potential for lost sales, though partially mitigated by customer sharing and exchange rate benefits.

Asked by Pulkit Patni

Revenue Growth Guidance & Copper Prices Direct
I can add here that if the prices remains bullish of the metals, then definitely, the revenue growth will be much more.

Clarifies that volume guidance is distinct from value growth, which can be significantly boosted by raw material price inflation, providing additional upside potential.

Asked by Pulkit Patni

Margin Expansion Drivers Direct
No. What he said is the freight side only related to the Middle East and our Middle East sale is practically very, very less. So it is no impact on the overall... But I can say that whatever extra freight we are bearing in April, that will be compensated by higher exchange rates, which we will get from our export revenue in those orders itself because those orders were priced at anywhere around INR90 or INR91.

Explains how the company maintained/improved margins despite external cost pressures, highlighting effective risk mitigation and pricing strategies.

Asked by Puneet Gulati

Volume Growth Source & Sanand Ramp-up Direct
Existing plants of basically Rajasthan plants, they are already working on the peak capacity, only the Chinchpada plant and the new plant of Sanand, they will add in the volume actually. ... Yes, it will be -- it could be around 20%, yes.

Provides clarity on capacity utilization and the phased contribution of new facilities to future volume growth, indicating sustained expansion.

Asked by Puneet Gulati

Dealer Network & Churn Direct
See, it's not inactive dealer. The major part of 20% dealers which do 20% of the total sales. So the 20% those dealers are anywhere between INR50 lakh to INR1 crores. So they are always first, they are operating in the smaller towns, doing small town sales or retail sales. ... So far as churning is concerned, I think every year, 10% to 12% is the churning of dealers, some dealers leaves and some new are added.

Gives insight into the company's distribution strategy, the role of smaller dealers, and the stability of its sales network.

Asked by Balasubramanian

Q4 Volume Growth Discrepancy Direct
In Sanand, fourth quarter sale was very less. It was less than INR100 crores because the ramp-up takes time. But now from the first quarter onwards for the current financial year, the sale from Sanand will be visible to that extent. ... Yes, it was mainly because of the capacity constraint actually.

Explains the reason for lower-than-expected Q4 volume growth, reassuring that it was capacity-driven and new capacity is now coming online.

Asked by Christopher Hartkopf

EPC Business Strategy Direct
No. Since last 3, 4 years before, we have guided that EPC business will go down towards the 2%, 3% only. So as per the guidance because there, the working capital is very long in EPC. So because of that, we are increasing the retail where the working capital is very low. That's how it is our plan.

Clarifies the strategic role of the EPC segment and the company's focus on optimizing working capital by prioritizing B2C and EHV cable projects.

Asked by Shreya Kejriwal

US Export Market & Data Centers Direct
See, data centers, I think we expect to supply them mainly HT cables and also some copper flexible. But presently, our market, what we have built for data center is only for the medium voltage HT cables to U.S. And we are working out that what other cables can be sold in the data centers because when we sell to data centers, we have to face competition from their American domestic industry as well. ... Basically, In U.S. market, close to INR50 crores, INR60 crores order book as of 31st March 2026 was there.

Details the company's re-entry and strategy in the US market, including product focus and initial order book, indicating a new growth avenue.

Asked by Parshv Shah

2 min read 6 chapters

Detailed narrative

Strong Q4 and Full Year FY26 Financial Performance

KEI Industries reported robust Q4 FY26 net sales of INR 3,476 crores, marking a 19.27% YoY increase. EBITDA margin expanded to 12.21% from 11.6% in the prior year, while PAT grew 25.5% to INR 284.31 crores. For the full FY26, net sales reached INR 11,746 crores, up 20.66% YoY from INR 9,735 crores, with EBITDA growing 30.56% to INR 1,387 crores, and PAT at INR 918 crores, reflecting a PAT margin of 7.82%.

Volume Growth and Capacity Expansion Outlook

The company achieved a 6.21% net volume increase in FY26, with copper cables growing 15% in volume. Despite Q4 FY26 volume growth being limited to 2% due to capacity constraints, KEI anticipates a 17-18% volume growth in FY27, primarily driven by the Sanand plant and Chinchpada wire capacity. For FY28, volume growth is projected to be around 20%, indicating sustained expansion from new facilities.

Strategic Business Mix and Distribution Focus

KEI is strategically reducing its reliance on the EPC business, aiming for its contribution to fall to 2-3% of total revenue due to long working capital cycles. The focus is shifting towards the retail (B2C) segment, which contributed 56% of Q4 sales (up from 51%) and 54% for the full FY26. The company maintains a network of approximately 2,125 active dealers, with an annual churn rate of 10-12%.

Re-engagement in US Export Market and Data Center Focus

After a period of lull due to tariffs, KEI has restarted exports to the United States, with a target to achieve approximately 20% of total sales from exports in the current financial year. The company aims to reach INR 40 crores/month in US sales within three months, focusing on supplying HT cables and copper flexible for data centers, despite facing competition from domestic US manufacturers. As of March 31, 2026, the US market order book stood at INR 50-60 crores.

Capital Allocation and Working Capital Efficiency

KEI plans an annual capital expenditure of INR 600-700 crores for the next 2-3 years, funded entirely through internal accruals, with 60-70% allocated to capacity expansion and 30-40% to working capital. The unutilized INR 385 crores from the QIP will be deployed in the current fiscal year for Sanand Phase 2. The company is actively managing its working capital, reducing receivable days from 2.2 months to 1.88 months, with a target of 1.75 months, and aims to remain debt-free for the next 4-5 years while achieving a 20% CAGR in topline.

Raw Material Price Volatility and Freight Cost Management

Average copper prices increased by 16.85% and aluminum by 9.91% in FY26. While freight costs, particularly for Middle East exports, increased significantly in April 2026, management stated the overall impact on margins was minimal as these costs are partially borne by customers (50%) or offset by favorable exchange rate fluctuations. Shipping problems in March led to INR 50-60 crores in lost export sales to the Middle East due to unavailability of shipping lines.

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