Sharp Growth Outlook for Indian Cable and Wire Industry
The Indian cable and wire industry is expected to witness a sharp growth outlook, driven by infrastructure-linked sectors and rising power consumption, urbanisation, and digitisation.
Key Highlights
- 20% volume-led growth in FY26
- 10% growth in volumes expected this fiscal, despite higher prices
- Volumes to grow on the back of demand for housing wires and power cables (~50% of total revenue)
- Investments worth Rs 10-12 lakh crore lined up in renewables, power, real-estate, and new age sectors
Crisil Ratings' Outlook
Crisil Ratings expects the industry to maintain pricing discipline and pass on most of the cost increases, despite commodity price surge and increasing competition from new entrants.
Key Takeaways from Crisil Ratings
- Realisations expected to rise by 18-20% due to sharp increase in raw material costs
- Prices of copper and aluminium have increased 22-27%, while prices of polyvinyl chloride (PVC) have risen about 12% over the last fiscal
- Absolute operating profits expected to expand 12-13% this fiscal
- New investment cycle in the sector, with capacity utilisation touching around 75% last fiscal
Capacity Expansion and Funding
Crisil expects manufacturers to expand production capacities, with overall capacities expected to go up gradually by 20-22% by the end of fiscal 2027.
Key Points on Capacity Expansion
- Nearly half of the expansion will be added by new players
- Most of the expansion will be funded through internal accruals and equity, helping maintain healthy balance sheets
- Debt-to-Ebitda expected to remain at 0.5-0.6 times, while interest coverage projected at 16-17 times, supporting stable credit profiles
Expert Quotes
According to Mohit Makhija, Senior Director, Crisil Ratings, "Healthy cash flows and steady demand will encourage players to ramp up capex as utilization levels already touched ~75% last fiscal."
Rucha Narkar, Associate Director, Crisil Ratings, stated, "Overall, capacities are expected to go up gradually by 20–22% by the end of fiscal 2027, of which nearly half will be added by new players."
Conclusion
The Indian cable and wire industry is expected to witness a sharp growth outlook, driven by infrastructure-linked sectors and rising power consumption, urbanisation, and digitisation. Crisil Ratings expects manufacturers to maintain pricing discipline and pass on most of the cost increases, despite commodity price surge and increasing competition from new entrants.