VIDYAWIRES

Vidya Wires reported significant operational progress, closing FY26 with continued strength across core business segments. The company successfully commissioned its ALCU Industries facility in February 2026, contributing approximately 800 metric tons of volume in its initial phase. Management plans to ramp up the ALCU facility to 100% capacity, adding 8,000-9,000 tons, by Diwali 2026, bringing total capacity to 35,000-36,000 metric tons. This expansion is expected to increase the company's market share from 5.7% to 11.3%.

For FY26, revenue from operations grew 24.2% YoY to ₹18,396.4 million. EBITDA reached ₹857.8 million with a margin of 4.66%, marking a 35 basis points year-over-year improvement. PAT stood at ₹576.1 million. The company expects EBITDA per metric ton to improve further in FY27 due to the addition of new product categories and better capacity utilization. The business model, which is completely back-to-back, insulates margins from raw material price volatility.

The ALCU facility enables the introduction of several new specialized product categories, including aluminum paper-covered conductors, enamelled wires, PV round ribbon, and multi-paper covered copper conductors. These products target high-growth segments like EV infrastructure, transformer manufacturing, and renewable energy. The CTC segment, a substitute for paper-insulated copper conductors, is expected to commence manufacturing by October/Diwali 2026, with an initial capacity of 3,000 metric tons, and is anticipated to contribute significantly to revenue and margins.

The Indian economy's structural resilience, coupled with the Union Budget's impetus on capital expenditure, drives demand in infrastructure, renewable energy, and 'Make in India' initiatives. The construction and power sectors' rapid expansion is shifting demand for high-quality electrical and industrial winding solutions from cyclic to structural necessity. Management anticipates strong volume growth for the next two years, with power and transmission segments currently contributing 51% of revenue, and renewables/EVs at 7%.

A significant portion of IPO proceeds was deployed for ALCU Industries' capital expenditure. The company repaid ₹100 crores of working capital borrowings, reducing interest burden and strengthening its credit profile. Management is focused on improving the working capital cycle from 60 days to 50-52 days and reducing debtor days from 41 to 35 days by increasing credit period days and reducing debtor days. The new ALCU unit benefits from a GST subsidy of 45-50% of the investment over 10 years.

Vidya Wires currently derives 12% of its total business volume from exports and aims to achieve a 75% domestic and 25% export mix. Export margins are generally better than domestic margins. The company acknowledges global supply chain issues, including increased ocean freights and the Middle East crisis, which affect both imports and exports. However, a wide customer and supplier base helps mitigate the direct impact of these challenges.