KEI Industries sustains uptrend: Here's what the management has to say on capex plans, debt, outlook

In an interview with ZeeBiz, electrical wires & cables manufacturer KEI Industries' chairman and managing director (CMD) Anil Gupta said, "We have a capex plan of Rs 250-300 crore in this year and about Rs 1,000 crore in the next four years.” In the wires and cables segment, the company uses almost 65 per cent capacity and plans to increase 15 per cent capacity through brownfield debottlenecking in the next 2-3 months.

KEI was founded in 1968 as a partnership firm under the name Krishna Electrical Industries to manufacture house-wiring rubber cables. Today, the company has grown to a cable manufacturing giant with a global presence in around 55 countries and 15,000 channel partner networks.

Talking about future growth, Gupta expects that there will be lots of growth in the next financial year as there is a huge demand for infrastructure in India and industrial expansion has already started. Moreover, the cable industry is connected to capex, so capex growth in industries like real estate, construction solar, or wind firms will be beneficial to it. KAE Industries saw a 37 per cent growth in the domestic institutional wire cable section in the last quarter. According to Gupta, the trend will be very strong in the next financial year as well. The central government has allocated Rs 10,000 crore funds for urban infrastructure boost in Union Budget 2023. So, it will help the company to grow the underground cable business.

The company generated 45 per cent of revenue from the distribution network in the nine months of FY 23 and it expects the same flow for the remaining year. The revenues from the retail sector are also expected to increase in this quarter, as per Gupta. As the cable segment is the company's core business, in EPC,  it follows the same guideline of not generating more than Rs 500-600 crore revenue because of the limited cash flow, he added.

Recently, Gupta, KEI Industries' promoter sold around 2 lakh shares in the company post and his stake decreased to 12.08 per cent from 12.3 per cent. Currently, KEI Industries has a net cash flow.

On 28 March 2023, the company said that it has entered into a strategic association with Royal Challengers Bangalore (RCB) as principal partner for the Indian Premier League (IPL) for three years.

Shares of KEI Industries were trading at Rs 1,775 each, up 1.68 per cent from its previous close at 2.48 PM IST in a strong Mumbai market today, 6 April. In the last six months, the company's shares have grown over 25 per cent, around 20 per cent on a YTD basis, and more than 45 per cent in the last one year.