1. At a Glance

KEI Industries reports a 🔌charged-up Q1 FY26: ₹2,590 Cr in revenue (+45% YoY) and ₹196 Cr in PAT. With zero debt, 22% CAGR profits, and a P/E over 50, is this the Polycab-lite dream or just a high-voltage bubble?

2. Introduction with Hook

If electrical infrastructure had a hero’s journey, KEI would be the underdog climbing transmission towers in slow motion. Starting as a small cable shop, it now runs ₹10,000 Cr+ topline with 10% stable margins, zero net debt, and enviable execution. But here’s the shocker: it trades at 51x earnings.

• Q1 FY26 PAT: ₹196 Cr
• QIP funds ₹2,000 Cr fully utilized (monitoring agency confirms)
• New Plant Alert: Sanand factory goes live by Q1 FY27

3. Business Model (WTF Do They Even Do?)

KEI manufactures and sells:

• Extra-High Voltage (EHV) Cables
• High/Low Voltage Wires
• House Wires
• Institutional Cables (Infra, Metros, Power Plants)
• Exports (15–20% revenue)
• Turnkey EPC (small % now)

Business is divided into:

• Retail (Dealer/Distributor)
• Institutional (Infra Projects)
• Exports
• EPC (declining focus)

They’re moving retail > infra for better margins and working capital control.

4. Financials Overview

Highlights:

• Debt: Practically zero
• Q1 YoY growth: +45% PAT, +45% revenue
• Export + Retail combo improving realizations

5. Valuation

Let’s plug in the numbers:

• P/E: 51.4x
• P/B: 6.59x
• Book Value: ₹606
• ROE: 15.6%
• Fair Value Range (EduVal): ₹3,200 – ₹3,600
• Current price of ₹3,990 = richly priced for a cable company

Unless KEI becomes the next Polycab, upside is already priced in.

6. What’s Cooking – News, Triggers, Drama

• Q1 FY26 Results: 45% PAT jump
• QIP Proceeds (~₹2,000 Cr) used to expand capacity
• Sanand plant to go live Q1 FY27: adds significant capacity
• Retail Channel Push: Focus shifting from EPC to B2C
• Exports rising: ₹1,500–₹2,000 Cr export vision
• EPS growth consistent – no dilution despite capex

7. Balance Sheet

Clean Book Alert:

• Debt negligible
• CWIP up = expansion
• ROCE: 21.3%
• Reserves up from ₹3,130 Cr to ₹5,767 Cr in a year = huge accretion

8. Cash Flow – Sab Number Game Hai

Insights:

• Operating cash flow dipped due to WC build-up
• Big investment in fixed assets
• QIP inflows covered capex

9. Ratios – Sexy or Stressy?

Verdict:

• Efficient operations
• Low receivables
• Slight WC expansion due to retail growth

10. P&L Breakdown – Show Me the Money

Notes:

• EPS CAGR = 23%
• Dividend policy conservative
• Strong profit trajectory

11. Peer Comparison

Conclusion:

• KEI is priced close to Polycab despite half the size
• RR Kabel expensive with lower margins
• Finolex = value pick, but lacks growth juice

12. Miscellaneous – Shareholding, Promoters

• Promoters: 35.01% (down from 37% in FY23)
• FIIs: 26.59% – stable institutional interest
• DIIs: 25.63% – increasing steadily
• Public: 12.77%
• Shareholders: 1.69 lakh – solid retail base

Trend:

• Promoters trimming
• Mutual Funds, FIIs loading up
• Retail % shrinking (price surge driving profit-booking?)

13. EduInvesting Verdict™

KEI is a top-tier wire & cable growth machine—clean books, stable margins, capacity expansion, and consistent earnings. But its valuation is humming like a live wire.

Unless Sanand plant unlocks the next level of scale or export orders surge, current price leaves limited upside. Polycab-level valuations need Polycab-level margins… and we’re not quite there yet.

So, KEI is undoubtedly wired for greatness, but investors at ₹4,000 should prepare for resistance—not conduction.

Metadata
– Written by EduInvesting Team | 23 July 2025
– Tags: KEI Industries, Wires & Cables, Polycab, Capital Goods, Sanand Plant Expansion