The Indian wires and cables sector makes up 40-45 percent of the country’s electrical industry. While the global wire and cable market was valued at $201 billion in 2024, projected to reach $266.2 billion by 2029, with a CAGR of 5.8 percent.
In 2023, the Indian market was valued at $8.71 billion and is expected to grow from $9.32 billion in 2024 to USD 17.08 billion by 2032, with a CAGR of 7.87 percent.
About the company
Finolex Cable manufactures and sells electrical and communication cables, copper rods, and electrical appliances. Its product range includes power cables, automotive, solar, and industrial cables, as well as optical fiber, CCTV, and LAN cables. The company also offers electrical switches, LED lighting, ceiling fans, water heaters, circuit breakers, smart door locks, and more. These products are sold through retail outlets and online stores under the Finolex brand.
R R Kabel manufactures and sells wires, cables, and fast-moving electrical goods (FMEG) both in India and internationally. The company offers house wires, industrial wires, power cables, and special cables, as well as FMEG products like fans, LED lighting, switches, switchgear, and water heaters. These products serve residential, commercial, industrial, and infrastructure sectors.
Stock Price movement
Finolex cable made a 52-week high of Rs 1,700 per share, down by 48 percent, and is currently trading at Rs 872 per share. The shares of Finolex Cable have given a negative return of 32.8 percent over the last six months.
RR Kabel made a 52-week high of Rs 1,901.95 per share, down by 52 percent, and is currently trading at Rs 910 per share. The shares of RR Kabel have given a negative return of 47 percent over the last six months.
Financial Highlights
Finolex Cables derives its revenue from four sources. Mainly electrical cables, communication cables, copper rods, and electrical cables being the largest contributor of revenue accounting 82 percent.
Finolex Cables has a market capitalisation of Rs 13,534 crore. It reported Rs 1,182 revenue in Q3 FY25, down by 3.27 percent, from its Q3FY24 revenue of Rs 1,222 crore. It reported a net profit of Rs 124 crore in Q3 FY25 as compared to a Q3 FY24 net profit of Rs 128 crore, i.,e, down by 3.1 percent.
RR Kabel derives its revenue from two sources. One is from Wire & Cables that accounts for 87 percent of the revenue and FMEG (fans, lighting, switches and appliances) accounts for 13 percent of the revenue.
RR Kabel has a market capitalisation of Rs 10,550 crore. It reported Rs 1,782 crore revenue in Q3 FY25, up by 9 percent, from its Q3FY24 revenue of Rs 1,634 crore. It reported a net profit of Rs 68 crore in Q3 FY25 as compared to a Q3 FY24 net profit of Rs 71 crore, i.,e, down by 4 percent.
Valuation Highlights
Finolex cable has a P/E ratio of 24.79x on the other hand, RR Kabel has a P/E ratio of 39.50x against the industry P/E ratio of 23.40x. This highlights that finolex cables is trading at a fair valuation whereas RR Kabel is currently overvalued.
Future Prospect
Finolex Cable plans the completion of its e-beam facility. It also plans a capex of Rs 500 crore by expanding into auto cable lines in Roorkee and expansion of fiber draw capacity from 4 million to 6 million.
RR Kabel plans a capex of Rs 1,200 crores over the next three years. It also plans to launch new high-margin products, which will enhance the top-line collection.
Conclusion
Finolex Cables offers a stable and fairly valued investment with a strong market presence and expansion plans, particularly in cables and electrical appliances. Despite recent stock declines, it has solid growth prospects.
R R Kabel, though slightly overvalued, shows revenue growth and has aggressive plans for expansion and new high-margin products. While Finolex provides stability, R R Kabel offers higher growth potential, making both appealing based on investor priorities.
Written by Satyajeet Mukherjee
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