CLSA backs Polycab and RR Kabel as India’s cable market heads for another capacity cycle
The brokerage rates Polycab and RR Kabel Outperform while keeping KEI at Hold, arguing that electrification, infrastructure and manufacturing demand should outpace new capacity. It expects formalisation to reach 85% by FY30, favouring scaled brands with distribution depth and integrated manufacturing.
What happened
CLSA initiated coverage on Indian cable makers, rating Polycab and RR Kabel Outperform and KEI Hold. It expects infrastructure, electrification and
Key facts
- Polycab target price: Rs 10,150
- Polycab implied upside: 13.9%
- RR Kabel target price: Rs 2,850
- RR Kabel implied upside: 14.3%
- KEI Industries target price: Rs 4,800
- KEI implied downside: 1.4%
- Industry capacity doubled over the past five years
- CLSA expects potential for another doubling over the next five years
- Formalisation estimated to reach 85% by FY30
Why this matters
The projected doubling of industry capacity and an 85% formal market by FY30 raise the strategic value of acquisitions or partnerships that add regional distribution, specialised products or backward integration.