Polycab vs RR Kabel vs KEI Industries; who performed better in Q4 FY25 results? Here is the analysis

The cables and wires segment was in the limelight after Ultratech Cement and Adani Enterprises announced their plans to foray into the cables and wires segment. Following the news of Adani Enterprises foraying into the segment on March 26, the shares of existing players like Polycab India, KEI Industries and RR Kabel fell more than 20% on March 27. The shares have now recovered all these losses and trade higher than March 27 levels on optimism around the Q4 earnings. All the key players in the segment have now reported their Q4 and FY25 earnings and have shown remarkable growth in the previous quarter.

High double-digit topline growth

The three key players in India’s cables and wires segment reported a more than 25% YoY jump in quarterly revenue for the March quarter. Polycab India’s total revenue grew by 25% YoY to ₹6,948 crore, KEI Industries saw a growth of 25.1% to ₹2,915 crore, and RR Kabel posted a 26% YoY jump in revenue at ₹2,217 crore. RR Kabel reported its highest ever revenue in Q4 and FY25 on the back of a 28% jump in the cables and wires segment for Q4FY25 and a 13% jump in the FMEG (Fast movable electric goods) segment. For Polycab India, the cables and wires segment grew by 22%, and KEI Industries reported a 35% jump in the total cables and wires segment.

Superior operational efficiency

On the operational front, too, the cables and wires players witnessed strong growth across the board. RR Kabel witnessed the best numbers with a 69% jump in EBITDA (Earnings before Interest, Taxes and Depreciation) to ₹195 crore with an 220 bps point expansion in EBITDA margin to 8.8%. Meanwhile KEI Industries EBITDA margin stood at 11.6% as against 11.15% in previous year same quarter.

Lastly, Polycab India’s EBIT margin for the quarter stood at 15.1% with a slight contraction of 40 bps and the over all EBIT grew by 20% YoY to ₹741 million. The slight contraction was primarily driven by 24% revenue decline in the international business.

Profitability metrics

In line with superior operating profits, RR Kabel the best in category profit growth of 64%YoY to ₹129 crore. Meanwhile Polycab India’s profit grew by 33% YoY to ₹464 crore and for FY25 profit after tax grew by 13% to ₹2045 crore. Lastly, KEI Industries net profit for the quarter also grew by 34% YoY to ₹227 crore. Among all the key players, Polycab India continues to be the most profitable cables and wires company in the segment.

In summary, the cables and wires players have witnessed robust growth across the board and displays strong potential to grow. However, experts believe impact on market share and margins as new entrants plan to disrupt the space.