India’s wires and cables companies have delivered strong returns over the past few months. The sector contributes nearly 40-45% of India’s electrical industry, making it one of the key pillars of the country’s industrial and infrastructure ecosystem.
For years, growth was largely driven by infrastructure, power, real estate, and government-led capex. But a new opportunity is now emerging. Sunrise sectors such as data centres, electric vehicles, renewable energy, and defence manufacturing are beginning to reshape demand for the industry.
These sectors require high-voltage, fast-charging, fibre-optic, and structured cabling solutions. At the same time, the rapid adoption of AI, cloud computing, and 5G is accelerating the expansion of data centres across India. This is creating a fresh demand cycle for specialised cables and high-speed transmission systems.
As per Prabhudas Lilladher Capital, electrical cables account for nearly 10% of the total cost per megawatt (MW) in data centre projects. With EPC costs estimated at ₹ 20.0–22.5 crore per MW, the cable opportunity becomes sizeable as capacities expand.
India’s data centre capacity is projected to rise from 1,337 MW in FY25 to 3,395 MW by FY30, implying an addition of 2,058 MW over the next five years. This translates into an estimated total EPC opportunity size of nearly ₹46,400 crore. Of this, the wires and cables sector (10%) could capture around ₹4,600 crore, or ₹927 crore annually.
Electrical Cable Accounts for 10% of Data Center EPC Capex
Meanwhile, the wires and cables industry is projected to grow from ₹90,000 crore in FY25 to ₹1,57,500 crore in FY30, positioning it as a rapidly expanding sector. Against this backdrop, this article examines three market leaders that unveil robust expansion plans to capitalize on upcoming growth opportunities.
#1 R R Kabel: The Extra High Voltage Growth Play
R R Kabel manufactures electrical goods, specifically Wires & Cables and Fast Moving Electrical Goods (FMEG). It has crossed the US$ 1 billion revenue milestone, achieving its highest-ever annual revenue of ₹9,722 crore in FY26.
The Wires and Cables segment is the growth driver, accounting for 90% of the total revenue in FY26. Within this segment, its product sales mix comprises approximately 73% wires and 27% cables. Cable’s contribution to revenue is expected to increase to 31% from the current 27%.
The ₹1,200 Crore EHV Pivot: Moving Up the Value Chain
Currently, R R Kabel has the manufacturing capability to produce cables up to 66 KV. To capture more value, it is executing a ₹1,200 crore CAPEX to manufacture Extra High Voltage (EHV) cables up to 220 KV by FY28. This 220 KV capability represents the lower end of the EHV segment or the higher end of the high-voltage cable spectrum.
Since the capacity utilization exceeds 90%, adding this new capacity is crucial to meet future growth requirements. Portions of the new 220 KV capacity will start going live by the middle and end of FY27. The entire capacity is expected to be fully completed by FY28.
Once fully commissioned, this will enable faster execution of B2B cable orders and greater operational leverage. The company plans to add new capacities progressively every six months.
Data Center Redundancy: A Massive B2B Growth Lever
Through this expansion, R R Kabel aims to grow its B2B segment by targeting rapidly growing sectors such as data centers. Management views data centers as a “massive sector” expected to see strong demand over the next 3-4 years. Thus, data centers, along with wind and solar energy projects, have been the primary target markets.
The Redundancy Premium: Why AI Infrastructure Requires Massive Over-Cabling
Data center operators can’t afford even a 0.01% failure in power. To ensure this reliability, these facilities typically feature four or five redundant power backup systems. These systems require massive volumes of wiring and cabling throughout the infrastructure.
The company is actively preparing to capture this incoming demand.
The company is currently approaching data center customers to secure the necessary product approvals. They plan to cater to this market using a mixed approach, supplying both directly to the end customers and through their established distribution networks.
It projects 16-18% year-over-year volume growth (above industry average), driven by scaling its B2B business.
The Middle East Export Hurdle
In FY26, the company derived 74% of its revenue from the Indian market and 26% from global exports. Compared to its competitors, R R Kabel has a significantly higher reliance on exports. Around 30% of its revenue from its wires and cables business comes from exports. Of this, the Middle East accounted for 40%, representing 12% of the overall top line.
Due to this high revenue exposure, it is likely to experience short-term negative impacts on export revenues in Q1FY27. However, the company remains confident that its presence in other global markets will help mitigate this impact over the long term.
B2C to B2B Transition: RR Kabel’s Strategy for 18% Volume Growth
To sustain its operations, the company is currently guided by a 3-year strategic roadmap called “Project RRise”. Through this initiative, R R Kabel focuses on deepening customer engagement, expanding its global footprint, and increasing efficiencies. Its goal is to achieve an 18% CAGR in wire and cable volume.
From a financial perspective, the company’s revenue grew 28% year-on-year to ₹9,722 crore, driven by 31% growth in Wires and Cables revenue to ₹8,764 crore. EBITDA rose 62% to ₹789 crore, while margins expanded by 171 basis points to 8.1%, driven by economies of scale. As a result, net profit surged by 58% to ₹492 crore.
For dividend hunters, it also paid a total dividend of ₹9.5 in FY26, including a final dividend of ₹5.5 per share announced during Q4FY26 earnings. This translates to a dividend yield of 0.5%. This is low compared to a 3.7% yield offered by this zero-debt PSU.
#2 Polycab: From Market Leader to Data Center Enabler
Polycab is the largest company in the Indian electrical industry by revenue. The company manufactures and sells electrical products. Wires & Cables is the company’s core business and largest segment. Polycab holds 30% market share in the organised wires and cables industry in India.
Dominating the Core: Polycab’s ₹25,000 Crore Wires & Cables Engine
The company reported its highest-ever consolidated revenue of ₹28,884 crore in FY26. The Wires and Cables segment continues to be the dominant contributor, generating ₹ 25,179 crore in FY26 (accounting for roughly 87% of the total revenue).
The FMEG segment contributes 8%. The domestic market accounts for almost 95% of its business. Polycab’s business model heavily leans on its distribution channel. They account for about 90% of its sales, with institutional (B2B/tender) sales making up the remaining 10%.
The Data Center Pivot: Tapping into AI-Driven Demand Pockets
Data centers represent a key structural growth driver for Polycab, particularly within its Wires & Cables business segment. The company has strategically positioned its products to play a critical role in high-growth sectors, including data centers, renewable energy, metro rail, and advanced manufacturing.
Project Spring: Scaling CAPEX to ₹8,000 Crore for FY30 Targets
Polycab’s management specifically highlighted data centers and artificial intelligence-driven demand as “new demand pockets” that are yet to fully bloom.
In addition, the emerging sectors, alongside defence and EV charging networks, are expected to expand significantly and generate sustained, robust demand over the coming years.
The company estimates that the projected CAPEX (public + private) of approximately ₹36 lakh crore in FY27 will translate into robust demand for cables and wires. Polycab is also preparing to capitalize on data center opportunities.
Polycab is already providing specialized solutions for large data center projects, including Vodafone Idea’s data centers.
Polycab’s management has laid out clear financial and operational targets to be achieved by the end of the FY30 under its “Project Spring” strategy. The company aims to outpace the industry by growing both its Wires & Cables and FMEG segments at 1.5x to 2x the market growth rate.
It also intends to raise the dividend payout to over 30%, up from 27.2%.
FY26 Financial Review: Margin Expansion Amidst Record Revenue
To support this growth, Polycab has committed a CAPEX of ₹6,000-8,000 crore over the next 5 years. Approximately 90% of this will be directed toward expanding Wires & Cables capacity. Like R R Kabel, a new Extra High Voltage capacity is on track to be commissioned by the end of 2027 and will start contributing to revenues in FY28.
From a financial perspective, Polycab FY26 revenue grew 29% year-on-year to ₹28,884 crore, driven by 33% growth in Wires and Cables revenue. EBITDA rose 35% to ₹4,006 crore, while margins expanded by 70 bps to 13.9%.
Operating leverage and a favorable product mix shift drove this expansion. As a result, net profit surged by 32% to ₹2,708 crore.
#3 KEI Industries: Betting on Exports and High-Voltage Growth
KEI Industries manufactures wire and cable for both institutional (B2B) and retail (B2C) markets.
The Integration Advantage: Scaling Beyond Standard Wires
Its specific cable and wire products include Extra High Voltage, High Tension, and Low Tension Cables. In addition to standard cables, KEI manufactures and sells stainless steel wires.
KEI also operates an EPC division, but it is strategically a supporting business rather than a growth engine. The EPC division primarily supports its extra-high-voltage cable projects, where the value of the cables accounts for more than 80% of the project value.
Backward Integration: Protecting the Bottom Line
To support its cable manufacturing, KEI engages in backward integration by manufacturing some of its own raw materials. It manufactures PVC compounds and low-tension XLP compounds. The company is also planning future projects to manufacture its own medium-voltage compounds and galvanized steel wire for cable armoring.
Like R R Kabel and Polycab, data centers also represent a significant and growing driver of demand for KEI. Management has highlighted the expansion of data centers as a major catalyst for strong demand. Internationally, data centers are expected to be a “big booster” for KEI’s export business, particularly in the American market.
The US Export Rebound: Navigating Tariffs and Data Center Demand
Following a temporary slowdown in FY26 due to US tariffs, KEI has successfully resumed its export operations to the US. It anticipates that data center projects will help drive substantial sales in the region. The company primarily expects to supply medium-voltage HD (High Tension) cables, as well as some flexible copper cables, to meet data center needs.
KEI is actively evaluating its portfolio to identify additional cable types it can introduce for data center projects. However, management acknowledges that expanding their product footprint in this specific sector is challenging, as they face stiff competition from the established American domestic cable manufacturing industry.
Sanand Expansion: The Roadmap to 20% Volume Growth in FY28
To boost its growth, KEI is investing in expanding its manufacturing network. The first phase of the Sanand plant was commissioned in December 2025. The second phase is expected to be completed by Q4FY27. The company anticipates volume growth of 17-18% in FY27 and projects growth of up to 20% in FY28 following the completion of the second phase of the Sanand plant.
Financial Performance: Margin Expansion Amidst Record Revenue
From a financial perspective, KEI revenue grew 21% year-on-year to ₹11,748 crore in FY26, driven by 32% value growth in the wire and cable segment. EBITDA rose 31% to ₹1,388 crore, while margins grew by 89 bps to 11.8%, driven by a favorable product mix shift toward exports and B2C sales. As a result, net profit surged by 32% to ₹918 crore.
Valuation Gap: Are Wires and Cables Stocks Trading at a Discount?
With superior growth and profitability, Polycab leads the return ratios (Return on Capital Employed and Return on Equity) chart, followed by R R Kabel and KEI. All three companies, as industry leaders, are trading at a premium to the industry median. R R Kabel, however, trades at a slight discount to 3-year historical median, while Polycab and KEI trade at a premium.
| Valuation Comparison (X) | ||||
| Price-to-Earnings Multiple | Return Ratios | |||
| Company | Company | 3Y Median | ROCE (%) | ROE (%) |
| R R Kabel | 43.4 | 49.3 (2.7 Yrs) | 25.8 | 20.8 |
| Polycab | 51.2 | 47.8 | 34.3 | 24.5 |
| KEI Industries | 53.1 | 51.4 | 20.1 | 14.8 |
| Industry Median | 25.6 | 20.3 | 18.9 | |
India’s wires and cables industry, already valued at nearly ₹90,000 crore, is expected to reach ₹1,57,500 crore by FY30. With India’s data centre capacity projected to expand from 1,337 MW to 3,395 MW by FY30, companies expanding into EHV cables, exports, and B2B solutions could emerge as key beneficiaries of this next growth cycle.
However, in the short term, raw material prices could threaten margins and profitability. The key risks to watch out for include raw material prices for copper, aluminum, oil, and PVC. That said,keep these stocks on your watchlist to see how they tap into the data center demand.
Disclaimer
Note: Throughout this article, we have relied on data from http://www.Screener.in and the company’s investor presentation. Only in cases where the data were unavailable have we used an alternative, widely accepted, and widely used source of information.
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About the Author: Madhvendra has been deeply immersed in the equity markets for over seven years, combining his passion for investing with his expertise in financial writing. With a knack for simplifying complex concepts, he enjoys sharing his honest perspectives on startups, listed Indian companies, and macroeconomic trends.
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