Ambit Capital has initiated coverage on the Indian wires and cables sector with a bullish stance, spotlighting major players such as Polycab India, KEI Industries, RR Kabel, and Havells India. The firm has issued a ‘buy’ rating for all four companies—ranking them in that order—citing their strong market positions and export-oriented strategies as key drivers of future growth. Ambit estimates a robust compound annual growth rate (CAGR) of over 12% for the sector, supported by favourable market dynamics.

The Indian wires and cables industry has performed strongly over the past five years, driven by consistent market share gains, improved return on equity (RoE), and a focus on de-leveraging. According to Ambit, the sector’s growth outlook remains positive, thanks to increasing capital expenditure in power transmission, distribution, and the renewable energy segment. Industry leaders like Polycab and KEI Industries, which already rank among the top 30 global players, are well-positioned to benefit from this investment cycle.

Ambit’s report also emphasizes aggressive capacity expansion plans, projecting approximately ₹132 billion in capital expenditure between FY26 and FY28. This investment is largely targeted at accommodating the surge in demand triggered by renewable energy initiatives and infrastructure development. Although the entry of new players such as UTCEM and Adani has sparked concerns over possible market oversupply, Ambit maintains that established firms will maintain their growth momentum.

Export strategy emerges as a critical component of these companies’ growth models. With increasing scale and global competitiveness, Indian manufacturers are poised to tap into international markets more effectively, which could significantly boost their revenues. The industry has already seen a nearly 21% correction in valuation multiples, indicating potential for price appreciation if current expectations are met. Ambit has set target prices at ₹7,000 for Polycab, ₹3,883 for KEI, ₹1,803 for RR Kabel, and ₹1,755 for Havells India.

Ambit further explains its preference for cable-focused companies over those more reliant on wires, pointing to lower competition and higher-margin export opportunities in the cable segment. This strategic distinction underpins their ranking of Polycab and KEI above RR Kabel and Havells.

While challenges remain—such as fluctuating commodity prices and possible headwinds from a cooling real estate market—Ambit remains optimistic. The Indian wires and cables sector is expected to experience accelerated volume growth, propelled by renewable energy needs, increased spending on transmission infrastructure, and emerging applications like data centres and electric vehicles. For investors, this sector continues to hold substantial promise.